IT Best Practices for FinTechs

In the digital era, fintechs are becoming one of the most lucrative and desirable targets for hackers. Here are the tips on how you may avoid taking the bait and keep your IT system 100% secure.

Fintech can be seen as a flourishing new frontier of an industry of software, apps, or other technical tools that modernize conventional financial services. The global financial technology market is expected to grow gradually and reach a market value of approximately $305 billion by 2025, this would imply a growth annual rate of about 22.17% over the period of 2020–2025. Unfortunately, fintechs are particularly prone to security breaches since they interact with confidential data, financial information, passwords, and other personal client information.

This is why an average user should be more concerned about a fintech’s tech compliance practices and how their favorite fintechs manage data security before trusting their hard-earned money to these services. Most Fintech startups have common critical security issues that we should all understand the basics of and what best practices exist in order to mitigate risks. This presents an opportunity for fintech startups to keep cybersecurity as part of their edge in the market differentiating themselves from competitors.

IT security failures happen more often than we get to see in the news. Like in July 2020 a Fintech Giant confirmed the data breach after reports emerged that details involving as many as 7.5 million banking users. The data was later on reported as being sold on forums, being all attributed to a vulnerability exploited by a third party that fintech used giving the hackers unauthorized access to such customer data.

An accomplished squad of cyber geeks with the capacity to safeguard the information is the most potent tool that these Fintechs can use. Startups who struggle to build out a comprehensive cybersecurity approach tend to have damning regulations or even a hacker waiting for the right moment to strike. Luckily, there are free maturity tools provided by governing bodies or an external assessment such as a pentest that are an integral part of identifying and mitigating any security risks. Most fintechs remediate such vulnerabilities through a third party that conducts tests over the platform’s capabilities.

The most critical aspect of a comprehensive cybersecurity program is to ensure that controls and governance are incorporated in the organization and that management’s dedication is clear. Fintechs must certify cyber-security policy at the board level and include a regular review like a SOC (System and Organization Controls) by a certified party to check procedural enforcement. In addition to keeping all this in compliance these steps would be important to get started:

The degree of risk to fintech startups involves the most substantial readiness level possible. The degree of risk involves a cybersecurity approach that incorporates new technologies and an accomplished cybersecurity team. This often uses governance mechanisms such as:

• Anti Malware — to protect your data from malicious software.
• Data Loss Protection — to prevent employees or external users from leaking data outside of your organization.
• File Level Protection, or other accountability strategies in the approach — to protect the integrity of your data and the customers.
• Monitoring software — to keep on the lookout for breaches or system failures.
• MDM (Mobile Device Management) — with the increasing use of tablets and smartphones the organization needs to protect such devices too.
• Secure SDLC (Software Development Life Cycle) — for innovation with security embedded into the product.
• Patch Management — to keep your systems updated and avoid exploits from the software.
• Encryption for both data at rest and in transit — so only authorized users are able to see what is intended.

Flexible and scalable fintech frameworks such as NIST, FFIEC, and ISO 27000’s are often employed for both startups or even unicorns. These frameworks give fintechs an edge and the ability to stand out, not just for customers, but garner a strong reputation and respect as they evolve and add value to their products.

Conclusion

In this day and age, no company can let its guard down from never-ending cyber threats. Now is the best time to think about IT security with the ever-changing environment of fintechs and an increase in insider threats, whether malicious or unintentional. Otherwise, it might be too late after the data is out in the wild and the company is doing damage control.