A new consortium has been created by the World Economic Forum to boost cybersecurity among the financial and fintech industry.
The consortium, led by the World Economic Forum, includes Citigroup, Hewlett Packard Enterprise (HPE), Zurich Insurance Group, Kabbage and the Depository Trust and Clearing Corporation in the founding members. It will be focused on improving the cybersecurity of fintech companies as the collaboration between fintech’s and financial institutions grows.
Working together the group will develop a framework that will allow them to assess the security level of fintech companies, whose preparedness against hacks is seen significantly important to the stability of the wider financial industry.
The financial sector is among those that are most vulnerable to cyber-crime, due to the significant amount of money and valuable data organisations such as banks process every day.
Collaboration between banks or finance firms and young start-up organisations has grown over the last few years, aiming to give the financial services a face lift to how they are consumed and developed. The growth has been encouraged due to new regulations such as the EU’s revised Payment Service Directive as well as volunteering to join forces to better competitiveness.
The increasing need to better cybersecurity within the fintech industry has risen as the increase of innovative technology has continued. The use of biometrics and robotics has expanded the about of data financial services hold, therefore needing more capabilities to protect this.
“While we are excited by the innovation of fintech, it also creates risks that I think need to be identified and worked on to establish standards,” Michael Bodson, president and CEO of DTCC, said in an interview according to Reuters.
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Working alongside the World Economic Forum’s Global Centre of Cybersecurity, the consortium will develop a point-based scoring system for fintech firms. This will enable the consortium to manage and analyse the levels of security within firms.
Furthermore, the World Economic Forum also released a report that stated one of the solutions needed to overcome the security challenges was better cybersecurity assessment mechanisms as well.