A study of the cybersecurity challenges faced by financial institutions

Abstract

Technology has dramatically transformed today’s business environment. The Internet of Things, social media, cloud computing, amongst other things, have changed the way financial institutions do business and communicate with each other. All of these aspects have brought about the advantage of digitalisation which offers great benefits and opportunities for financial institutions. It goes without saying that any kind of benefit derived from the use of such evolving technology, results in a number of risks. An emerging risk which companies in today’s business world are facing is that of cyber risk. Cyber attacks are on the risk, are not only becoming more common but also more sophisticated. It can be said that as technology evolves, such attacks are becoming ever more complex. In this regard, financial institutions need to focus on their cybersecurity strategies, so as to protect their business and the data which they hold. Cybersecurity can be defined as the practice of securing networks, systems and any other digital infrastructure from malicious attacks. (Builtin.com, 2020) Any entity which holds data and which makes use of online technology is exposed to this type of risk. Therefore, each entity should understand the market in which it operates and the risks to which it is exposed. Furthermore entities are to also understand the magnitude should they suffer a cyber attack and should also work on preventing these attacks from materialising. This dissertation provides an analysis of the current cyber threat landscape and together with an insight on the threats prevailing in the financial market industry. Reference is also made to local financial institutions and the cybersecurity threats which they are facing. The research also assesses current regulatory developments both an on a local and EU level.