Digital Finance: How Do Banks Protect Their Customers’ Money and Data from Cybercriminals?

In an era where banking transactions can be completed with a single click, the issue of cybersecurity is more pressing than ever. Each transaction and every password entry presents a potential target for hackers. While we once worried about the safety of cash in our wallets, today our digital assets and confidential information are at stake. 

The fintech industry is developing rapidly, offering us a wealth of conveniences and opportunities. However, with these advancements come growing risks. Cybercriminals are employing increasingly sophisticated methods to access our money and data, making this issue particularly relevant for large European banks, where significant financial assets are concentrated. 

So, how can we ensure security in this digital landscape? What technologies are in place to safeguard our finances? And can artificial intelligence truly breach even the most robust protections? 

To find answers, we consulted Mainsoft’s founders Andrei Pahozhau and Pavel Uhniavionak, who develop advanced cybersecurity solutions for leading European banks in France, Switzerland, Germany and beyond. 

The First Level of Protection: IAM (Identity Access Manager) 

One of the primary methods for safeguarding user data in mobile banking is through specialized applications that provide secure identification. It is called an identity access manager (IAM) and serves as the first line of defense when accessing the banking system, acting as a gateway that controls user access to various banking products and services. 

Users encounter IAM as the login page of their banking app, where they enter their credentials. Importantly, the design of the identity access manager aligns seamlessly with the bank’s branding, ensuring a cohesive user experience. 

The primary purpose of these tools is to ensure reliable protection of user data and prevent unauthorized access to financial assets. IAM is responsible for storing account information, managing user roles and implementing two-factor authentication through various protective methods. The system securely stores passwords, prompts users to update them at regular intervals and enforces rules for creating strong passwords resistant to hacking attempts. 

In addition to primary authorization, IAM utilizes a secondary security factor, which may vary depending on the bank’s requirements. This could involve sending a verification message to a registered phone number or providing a code through a portable device issued by the bank. This device functions like a remote control, receiving a unique code for logging into an account each time. 

It is essential to note that IAM do not have direct access to users’ bank data and accounts. It interacts solely with the user’s account, maintaining a strict separation from the bank’s internal systems. All data is stored exclusively within the banking infrastructure. 

Cybersecurity Approaches and Technologies 

A multi-layered approach is adopted to ensure cybersecurity when dealing with banks and banking data, incorporating the following components: 

• Data Encryption and Signing: All data stored in the database is encrypted using robust algorithms. Additionally, the data is signed with special keys, making it virtually impossible to alter. 

• Web Application Firewall (WAF): The WAF acts as an additional layer of protection, filtering and controlling access to web applications. It blocks malicious traffic and prevents attacks aimed at exploiting application vulnerabilities. 

• User Self-Services: This feature allows users to independently manage their devices and credentials, reducing the burden on support services and enhancing application usability. 

• Single Sign-On (SSO): This mechanism enables users to access multiple applications using a single set of credentials, simplifying the authentication process and improving security. 

• OAuth and OpenID Connect: These protocols facilitate secure data exchange between applications, allowing users to grant third parties access to their data only with their consent. 

Another Security Strategy: Secure Mobile Messengers 

Secure banking messengers represent another critical layer of data protection. They enable users to communicate with bank representatives and bots, as well as perform important transactions (such as signing bank documents) using an electronic signature without leaving the application. 

These secure messengers operate on both Android and iOS platforms, providing instant communication and document exchange while ensuring a secure channel between the user and the bank. In addition to electronic signatures, these messengers offer functionalities such as recording and archiving audio calls and integrating structured data exchange through custom forms within the chat. 

Addressing AI-Driven Cyber Threats 

One of the emerging challenges in cybersecurity is the use of artificial intelligence (AI) in cyberattacks, including voice imitation and automated password cracking. Fortunately, modern technologies are equipped to effectively counter most of these threats. They can recognize repetitive actions and implement appropriate protective measures. 

• Blocking Repetitive Actions: The WAF can block suspicious activities, such as multiple failed login attempts or other repetitive actions that may indicate an AI-driven attack. 

• Multi-Factor Authentication: Employing multiple authentication factors — such as a password, biometrics, or a one-time code — significantly complicates the task for attackers, even those using AI. 

Protecting customer data and financial assets is a complex and multifaceted endeavor. The technologies mentioned are so reliable that, when used in combination, they make hacking attempts exceedingly difficult. Continuous testing and monitoring help maintain a high level of user data protection. 

However, the most common method that fraudsters use to deceive users remains phishing and social engineering, where attackers attempt to obtain bank card information through manipulation and deceit. Therefore, it is crucial to remain vigilant.