BY Fraser Tennant
A hard-hitting report released this week makes the startling claim that three-quarters (almost 8 in 10) of financial institutions (FIs) have experienced a cyber attack in the past two years, leading to many personal bank accounts being compromised.
The report, KPMG’s ‘Consumer Loss Barometer’, states that despite the financial services sector being proactive when it comes to matters of information security, more than one-third of consumers have said that their personal bank accounts have been compromised.
Furthermore, the report reveals that the vast majority of consumers would change banks if their provider of financial services did not take the proper steps to deal with the consequences of a cyber attack.
“Financial institutions have a real opportunity to solidify trust with their customers by demonstrating that security is a strategic imperative, and that they are taking every possible precaution to protect consumers,” said Jitendra Sharma, KPMG’s advisory line of business leader, financial services. “Consumers have a lot of options in this environment, so companies must get it right as the battle for customers is fierce.”
Having surveyed 400 senior cyber security executives (including 100 operating in financial services) and 440 banking consumers, the report found that: (i) 66 percent of finance executives said their companies invested in information protection in the past year; (ii) 85 percent of executives confirmed that they have a person in their company whose sole role is to oversee matters pertaining to information security; and (iii) 37 percent of banking consumers made it known that they would move to a new financial services provider if their bank refused to cover their losses.
In addition, consumers indicated that they would like their bank to guarantee to cover losses, issue frequent communications and updates and provide a free credit report in the event of a cyber security incident. KPMG also found that the financial services sector is the most proactive of all the sectors surveyed, with many FI’s investing heavily in information protection.
“It is encouraging to see that financial institutions are clearly making the investment in information security and are ahead of their peers from other sectors,” said Charles Jacco, advisory principal, financial services at KPMG. “But in order to retain loyal customers and attract new ones, they will need to continue demonstrating their commitment and ability to protect their customer’s assets and to put their minds at ease.”
Report: Consumer Loss Barometer