The financial services industry is one hit hardest by the heightened expectations of consumers to access information, receive help, and conduct transactions anywhere and at any time via their mobile devices. By 2025, Millennials are expected to generate 46 percent of all U.S. income, and yet over a fifth of them have never written a physical check to pay a bill. Instead, 38 percent use apps and mobile tools to make bill payments, and 71 percent consider their banking relationship to be transactional rather than relationship-driven.
In addition, more than one-quarter (27 percent) of Millennials are completely reliant on a mobile banking app. In fact, they are 1.3 times more likely than Gen-Xers and 2 times more likely than Baby Boomers to rely on a mobile banking app for regular banking activities.
For financial firms, the ability to offer such services represents a competitive advantage, with 75 percent of banks making investments to create and improve a customer-centric digital business model. Aside from benefitting consumers, greater accessibility to data on various devices and applications can also improve employee efficiency, meeting the common request for more open networks.
Personal Data at Greater Risk
This shift to online consumer banking has led to increasing data traffic volumes as more users rely on applications and endpoints to interact with their personal data. Addressing this growing volume of traffic has led many financial institutions to adopt cloud, and increasingly, multi-cloud environments. Which means that personally identifiable information (PII) is now regularly travelling across different network domains.
While this increases the accessibility of data for consumers, thereby making financial services firms more competitive, it also means that their data spans a larger potential attack surface, making it more susceptible to cyberattacks. As these attacks become more sophisticated, leveraging artificial intelligence and automation to more effectively detect and exploit vulnerabilities, financial services firms not only need to engage in digital transformation but to also do so securely – protecting the private data of consumers.
Greater Interest in Encryption
Regulators are taking a close look at financial services firms to ensure they are implementing the security controls necessary to keep user data private. One of the core security features being required by these bodies is encryption. Encryption refers to converting plain text into secure code that can only be deciphered with a decryption key. This ensures that data in motion across the network and the web, as well as data at rest in the cloud or data center, cannot be seen by anyone without the key – even if it is stolen – adding a strong layer of security.
Encryption for financial services firms is being recommended today by several regulatory guidelines, including the Federal Financial Institutions Examination Council (FFIEC) and the new General Data Protection Regulation (GDPR).