By Mr. Yogendra Goyal, Chief Technology Officer at Kuhoo
We live in an age of primacy of data. Data indeed is the new gold. Every information conceivable is on cloud networks, and cyberspaces are more widespread than ever. This accrual of cyber networks has led to a subsequent increase in the risk of data breaches and cyberattacks. Reports claim that India was amongst the countries which witnessed the highest number of cyber-attacks in 2022. These attacks perforated government agencies as well.
Hence it becomes imperative that the Fintech sector takes the onus of ensuring customers’ digital safety and protection since it has access to its client’s financial records. A breach may wreak havoc on the life of individuals and cost the company its reputation. Here are some reasons the Fintech industry must invest in cybersecurity and digital safety.
Facilitating trust amongst stakeholders is vital
Fintech companies handle vast volumes of data on the financial transactions of millions of people. Due to this, the industry is premised on trust, and a leak at any point in the process can destabilize the entire system. Moreover, it is a serious attack on the organization’s credibility, and it result in the loss of innumerable clients, further deepening the impact of such attacks. The fact that these organizations have access to traditional banking systems and their data further enhances their appeal to hackers.
A balance between security and flexibility
Traditional banking systems adhered to strict compliance with security and bureaucratic measures, sometimes at the cost of customer convenience and flexibility. On the other hand, startups entering the financial space have prioritized speed and efficiency over all other factors and sometimes over security concerns. Fintech companies should strike a balance between these two integral aspects of financial management and the provision of services without compromising on either convenience or security.
The need to stay updated
In the data protection and cyber security realm, it is not enough for Fintech companies to have a cybersecurity policy in place. This policy must be strictly implemented and needs to be revised and kept in tune with the emerging threats in cyberspace. It is only through awareness and accuracy of prediction that attacks can be preempted, and data security policies can be formulated.
Security can be the basis for expansion
Growth and revenue generation in the field is highly dependent on the ability of the Fintech platform to secure reliable partnerships with clients, other firms, or service providers. In the absence of a robust security policy, such alliances are difficult to secure, and understandably so. Due to the interconnected nature of the economy, a breach at any checkpoint compromises the entire system and, more so, if the threat is targeted towards a financial mediator or systems of financial management.
Bottomline
Cybersecurity and data protection are paramount for all sectors of the economy, especially for the Fintech industry, considering the sensitive nature of the information they handle. A compromised policy in this segment would have implications at the micro and macro levels; thus, data protection is the way forward for this sector. Its success and survival rely on its ability to ensure privacy and security for its customers.
