In our increasingly digital age, the financial world, including Islamic banking, has harnessed technology for efficiency and convenience. However, this digital revolution has given rise to a growing threat: cybercrime.
Islamic banking, much like traditional finance, must confront numerous cybersecurity challenges that demand our vigilance. These threats not only imperil the safety of financial transactions but also raise ethical and regulatory concerns within the context of Islamic finance.
In this article, we highlight Islamic banking’s vulnerabilities in the realm of cybersecurity. We’ll dissect the risks posed by cyberattacks to financial institutions, their customers, and their employees, emphasizing the critical need to tackle these challenges to ensure the sustained growth and stability of the Islamic banking sector.
Islamic banks are an attractive target for cybercriminals.
The latest ransomware attack data reveals 81% of financial services organizations hit by ransomware had their data successfully encrypted; of these, in 25% of successful attempts, data was stolen in addition to being encrypted. Attacks like these have increased over the last four years and are expected to continue to do so.
The financial services sector illustrates a number of desirable features for cybercriminals. These include:
- Sensitive and confidential personal data and funds.
- Outdated traditional banking systems which are difficult to maintain against modern and sophisticated evolving threats.
- New entry points to manipulate with the rise of digital banking.
- Potential weaknesses in cloud security measures.
- Human error due to manual processes, which are also susceptible to exploitation.
- And the rise of remote working increasing the surface area for attackers to access systems, making breaches more likely.
Developing an advanced cybersecurity strategy
The bank’s cybersecurity strategies should aim to identify, protect, detect, respond, and recover against internal and external threats using advanced technology tools, including phishing, ransomware, DDoS, SQL injections, and bank drops. Each of these attacks looks like an open door to accessing customer data or employee data to reach financial information.
Going on the offensive
Some of the most powerful and modern solutions in a bank’s arsenal against external threats are Artificial Intelligence (AI), predictive analysis, machine learning (ML), and blockchain systems. These are essential and advanced technologies for an Islamic bank’s data, applications, and network securities (including their website, mobile banking applications, and banking systems). These technologies empower automated threat management with real-time responses.
Islamic banks and financial institutions need to apply a “Zero Trust Approach” and deploy AI systems to monitor, alert, analyze, detect, and prevent millions of threats, physical and digital. This shifts cybersecurity from passive workflows to predictive measures – the offensive, not defensive.
Additionally, employing cybersecurity professionals with ethical hacking certificates is also crucial for protection. They bring with them knowledge of cybercrime opportunities and methods and represent an opportunity to be proactive in the fight against criminals.
We all make mistakes, so be prepared
Bank employees represent a potential opportunity for cybercrime, whether intentional or otherwise.
”58% of insider-related incidents are attributed to careless activities, including system misconfiguration, mistyped recipients, mistaken file attachments, or just simple over-sharing and this puts pressure on the banks to apply a ‘modern people-centric security’ approach for complete visibility and context into how insiders are interacting with data and assets.”
Consequently, you can integrate warning capabilities when a threat is in progress by monitoring bank employees’ and their activity through analytical and technological tools like AI, ML, blockchain, and/or data science. This helps to bring their data under control and make it secure.
The remote bank employees’ environment also poses a weakness and is susceptible to cyberattacks. To counter this, bank employees must use strong passwords and Multi-Factor Authentication with the latest tools. Their access should be limited to that required and regularly updated in line with Privileged Access Management policies in place Regular in the banking services and policies sector. Cybersecurity training is also necessary for all employees, as is ensuring the credibility of third-party partners.
How Islamic countries are responding
This year’s Arab Security Conference is focused on assisting business leaders in thinking more extensively about attaining adequate information security to ensure size and growth in the age of digital transformation. The UAE also has a long-term cybersecurity vision for the next 50 years.
Sharia law protects five values: religion, human life, intellect, lineage, and property. As a result, sanctions and fines are applied to cyberattacks that threaten any of these. Additionally, Malaysia and Indonesia have demonstrated a strong commitment to strict Islamic laws to protect against cybercrime.
Islamic banks must set up advanced strategies and processes using modern technology for clearly managed, encrypted, monitored, and secured data and processes. According to fortunebusinessinsights.com, “In the Middle East and Africa, the cybersecurity market is projected to grow by 16.2% during the forecasted period from 2023 to 2030.” The growth rate of the cybersecurity market reflects the widespread recognition of cyberattacks as significant issues across all countries and industries, including Islamic banks.
Name: Elias Hindi
Email: [email protected]
Position: Product Manager-Islamic Banking