Digital transformation continues to be a top priority for the financial services sector. Financial institutions continue to migrate their IT platforms and data to the cloud and offer remote access to customers via web-based and mobile applications. Maintaining high security standards during a digital transformation can be challenging. Securing cloud environments is very different from securing on-premise environments. Financial institutions and their software suppliers need to implement secure by design application development processes to secure their CI/CD pipelines. They need to strong data loss prevention (DLP) processes to secure highly sensitive client data. Client-facing applications need to provide the required level of security while ensuring relatively convenient system access for consumers.

A large financial institution can have thousands of suppliers. Each division, remote office, and satellite branch may use different, local, 3rd-party vendors for credit card creation, transaction clearance, ATMs, IT systems, and more. Process automation requires these supply chains to be electronically linked. This creates an ecosystem of digital interdependencies, each of which could be a potential attacker entry point. Financial industry suppliers may not adhere to the same level of cyber security standards as the financial institutions they serve, and therefore may be leveraged by threat actors as an entry point to attack the financial institution. All points of digital connectivity with third parties need to be secured and monitored.

Large financial institutions need to enforce corporate security policy across all divisions and remote locations. Each division should have its own hardening guide but often they do not. Even when there is a corporate hardening guide, divisions and branches may not follow it as closely as they should. For these reasons, remote offices in other countries may be targeted by threat-actors as attack vectors into the parent institution. Multi-national financial services organizations need cyber financial solutions that include security governance strategy, top-down review of policies, and procedures, and periodic testing to evaluate the effectiveness of each location’s security processes.

Multi-national financial institutions must comply with global, regional and country-specific mandates. They must also be ready to comply with new regulations implemented to strengthen cyber security standards for the financial industry. Recent global mandates include Basel III and PCI DSS. In 2023, the SEC adopted new rules that mandate cyber security risk management, governance, and disclosure. The EU’s NIS2, which will come into effect in late 2024, categorizes banking and financial infrastructure as essential entities with stricter reporting requirements and heavier penalties for non-compliance. In addition to cyber resilience and reporting requirements, data privacy mandates such as GDPR are of paramount importance for financial institutions.