Data security in banking comprises the protection of personally identifiable information (PII) from cyberattacks, data mishandling, and any forms of data breaches. Due to their nature of business, banks and other financial institutions are exposed to transactional and other general risks, such as employee fraud and external attacks that require continuous software and policy update.
Concerning the type of information related to financial transactions and the technology used to process and store this information, banks are more vulnerable to crimes than other organizations. Cyberattacks, in terms of data breach costs, are high in financial institutions than in other organizations. To achieve confidence among partners and clients, banks and financial institutions are forced to invest heavily in data security and effective policy development and implementation.
A data security policy for a bank is based on the objectives of the bank that, include customer satisfaction, as well as organizational protection to maximize output. There are elements that a data security policy of a bank should have. Vendor management is a vital element that every policy should have.
Vendors in banks are third parties that render services, such as suppliers, sellers of software used within the banking industry, professionals who offer consultations to the bank, and entities involved in managing customer information. The policy should outline possible risks and threats related to the third parties that handle confidential information. Risk management guidelines should be included to address threats related to integrity and personal information in compliance with banking rules and regulations.
Another relevant element is the management of strategic systems that are vital to banks. The strategic systems include accounting, banking and billing systems, and digital customer information records. The policy should clearly state who is in charge of the computer systems, who has physical access, and the one who will take responsibility in case of unauthorized access internally and externally.
A third element is a review of formerly attempted and successful security breaches with corresponding institutional and legal measures. There should be personnel whose suspicious activity should be reported for urgent action. Lastly, risk management policies with in-depth analysis of the impact resulting from a data breach, mitigation measures, risk assessment measures, and an outline of recovery measures should be part of the policy. Other elements include roles and responsibilities, password policies, management of mobile devices, encryption policies, and vulnerability scans.