Gap widens between customer expectations and financial institutions’ cybersecurity efforts
HYPR, a leader in Identity Assurance, has released its report, “When Trust is Hacked: Customer Identity Security in Finance,” highlighting the ongoing issues of credential misuse and authentication vulnerabilities in the financial sector. The report reveals a daunting reality for banks as customers increasingly demand better security measures.
A staggering 80% of banking customers would consider leaving their financial institution following a data breach, emphasising the critical role of trust in customer loyalty.
Insecure authentication methods have led to financial institutions experiencing losses up to $4.57 million over the past year, more than doubling the previous year’s figures.
Financial institutions are frequently targeted by identity-related cyberattacks, with phishing (42%), credential stuffing (29%), and identity impersonation (28%) among the most common forms of attack.
The report identifies a significant gap in expectations and delivery between banks and their customers:
Customers, especially younger ones, require transparency and robust security, with 93% of those under 35 ready to change banks after a breach.
While 95.5% of survey participants know about passkeys, there’s an evident demand (77%) for financial institutions to offer this technology as part of their authentication processes.
Financial institutions face a paradox of heavy investment in cybersecurity while remaining vulnerable to attacks. The struggle lies in implementing effective technology amidst evolving AI threats and growing customer expectations for both strong security and clear communication.
Bojan Simic, CEO of HYPR, highlights the pivotal moment for financial institutions to adapt, stating, “Our research exposes the dual challenge of deploying effective technology and meeting rising customer expectations.” The report is a call to action for these institutions to modernise their defences or risk losing customer trust and facing significant financial consequences.
