IoT and 5G Revolution: What to Expect for FinServ Productivity and Cybersecurity.

From mobile and online banking to ATMs, businesses in the financial industry have been early adopters of new digital technology. A recent study showed that 81% of financial organizations have made immense changes in technology at all levels of an organization. Mobile technology will only continue to accelerate rapidly as financial institutions seek to leverage emerging technologies to enhance service delivery. Such technologies include 5G and IoT (Internet of Things).

Impacts on FinServ

Most countries have already started rolling out 5G networks and they are set to disrupt cellular technologies.  Developers design 5G to be faster and more responsive than the current networks. At a glance, it will contain the following features:

• 999% network availability and reliability to support critical communications
• A low latency rate of about 1 millisecond
• A theoretical speed reaching 20Gbps
• Enhanced capacity, capable of supporting at least one million devices connected in every square kilometer

These and other capabilities will provide developers with new horizons for developing finance applications, impacting the financial industry in the following ways:

  i. Transformed Customer Experience

Delivering 5G-enabled services will fully transform the customer experience. With its ultra-low latency and increased bandwidth, 5G enables the development of virtual reality and augmented reality in smartphones and other IoT devices. Financial organizations will deploy robots with 5G capabilities to assist and converse with customers during a financial transaction. Moreover, mobility and smartphone data will permit easy targeted marketing of financial services, updating customers in real-time.

 ii. Revolutionized Payment Methods

Advancements in IoT and 5G technology will lead to payment embedment in virtually every context of IoT. This is to reduce the friction experienced during payment processes. 5G will provide ubiquitous and reliable connectivity and the financial industry will realize autonomous payment ecosystems, largely influenced by increased usage of IoT devices. Furthermore, 5G will boost an already established digital-commerce market. It will facilitate the development of IoT devices capable of providing customers with personalized shopping practices. For instance, Alibaba, Amazon, and Zara are already implementing augmented reality, which may also be used to make payments.

iii. Service Provisioning Through IoT

5G will enable service provisioning through IoT devices and wearable equipment. Research is still ongoing on other vehicles that businesses can use to make mobile payment transactions. Organizations and individual use IoT devices like smartphones to render some financial services. However, incorporating it in wearables such as smart glasses or fitness bands, and equipment like smart refrigerators will lead to a new era of automatic purchases.

iv. Enhanced Insurance Services

One of the main objectives behind the research and development of 5G technology is to enable driverless cars and smart infrastructure. Vehicles will be interconnected using actuators and sensors to communicate with each other in real-time. Insurance firms will use the same concept when investigating accident scenes. Rather than sending assessment teams to the scene, they will rely on the 5G high speed to access street cameras around the scene, and obtain relevant data for settling insurance claims.

Cybersecurity Challenges to Consider

Despite the various positive impacts 5G and IoT provide to the financial sector, it also has cybersecurity challenges that can cause wide-scale loss, damage the reputation of victim organizations, and open up huge litigation and legal processes. Most notably, stakeholders are still developing and testing 5G to uncover weaknesses. It will also facilitate the sharing of huge data volumes, and thus attract more criminals. Cybersecurity challenges the financial industry should consider when deploying IoT and 5G technologies are as follows:

  i. Faster and Stealthier Attacks

Criminals will leverage the speeds of 5G networks to execute quick and stealthy attacks. The fast speeds and low latency rates will enable hackers to penetrate systems and steal critical data before they are detected. However, research on AI-enabled cybersecurity tools is undergoing to counter emerging threats. The financial industry should nevertheless expect increased hacktivist campaigns as security experts will still be struggling to make 5G hack proof.

 ii. Insecure IoT

Today, IoT has already proliferated numerous financial institutions as they leverage the benefits offered to increase productivity levels. Vendors are hence competing to innovate newer and smarter IoT. Unfortunately, the rush has led to the development of insecure IoT without adhering to recommended DevSecOps standards. Most vendors also fail to support the devices through releasing security patches, or software and firmware updates. Once the 5G networks are implemented, individuals and employees in the financial services industry will be using the same IoT devices for transactions. This will expose the entire industry to security risks.

iii. Increased Attack Surfaces

Rolling out 5G networks will hasten the need for adopting network infrastructures that contain virtualized distributions, and use containerized workloads. As a result, 5G technologies will result in expanded attack surfaces across the divide. Firms providing financial services will be most hit as they are the most lucrative targets due to the financial motivations and sensitivity of the stored data. Also, it will be challenging for developers to verify whether security patches are released to address vulnerabilities in distributed or containerized environments. Subsequently, the attack vectors and surfaces will increase, posing more security concerns to financial organizations.

iv. Emerging Network Architectures

The 5G network architectures will variate from those of their predecessors. Rather than being hardware-based, distributed, and with a centralized switch, it will adopt a digital routing and software-defined approach; whereas hub and spoke designs could be implemented in the former to ensure all network activities follow cyber-hygiene processes. Activities in 5G networks will be based on software-defined networks, and pushed to digital web routers installed throughout the network. This will make it nearly impossible to detect or permit the implementation of choke points, and may be used for inspecting and controlling security in a network. As such, the main challenge finance companies will face is the inability to fully inspect a network for security events. Hackers can take the opportunity to exploit undiscovered vulnerabilities, enabling them to execute attacks at will.

Better Together in Cybersecurity Protection: ISA and Check Point 

Together, ISA and Check Point can provide financial services firms comprehensive advanced protection with simplified management so that they stay in compliance, minimize risk, and never lose their competitive edge.

ISA is a cybersecurity-focused technology firm, with over 28 years of experience helping organizations of all sizes solve complex challenges relating to IT security.  We act as trusted advisors to help our clients define, implement and manage their strategies to minimize IT security related risk, and to provide a secure business environment for their employees and customers.

Check Point is a key strategic partner of ISA and a multinational provider of software and combined hardware and software products for IT security, including network security, endpoint security, cloud security, mobile security, data security and security management

Contact us today to learn more.