Welcome to the latest edition of The Current Account! This month's headlines look at the concerns banks and financial services firms have around cybersecurity, and the technology they’re using to mitigate it, along with the persisting impact of the Bank of England’s interest rate hikes in the current inflationary environment.
Cybersecurity Concerns and the Technology Banks are using to Mitigate them.
The Bank of England revealed that cybersecurity is the current top concern of most UK Banks and Financial institutions. In the BoE’s recent Systemic Risk Survey the risk of a cyber-attack was the most cited, with the highest proportion of respondents citing cyber risk ever recorded in the survey.
- Increasingly, banks are caught in the cross-hairs of cybersecurity attacks: according to a study by Sophos the rate of ransomware attacks in financial services continues to rise, up from 55% in 2022 to 64% in 2023.
- Michael Barr of the Federal Reserve warns that banks face an AI ‘arms race’ in the battle against cybersecurity threats, with those using AI to attack, racing against those using it to block threats. He urged banks to invest in developing AI technology to help protect themselves, not only today but in the near future.
- Whilst there are concerns AI could be used to worsen cyber threats, generative AI can also be used to predict cyber threat scenarios, providing real-time defensive strategies, and both AI and machine learning can be used to mitigate threats.
- Some financial organisations are even using blockchain to enhance their cyber resiliency. Blockchain has consensus mechanisms that make it an ideal tool for preventing an attack on financial systems as all parts of the blockchain must have consensus to execute a command.