Introduction

Utilizing the cloud for financial services is quickly becoming the industry norm. And rightfully so, as the large volumes of sensitive data housed by the financial sector make it a high-risk industry for data loss and malicious cyberattacks.

According to a recent Varonis report, the average financial services employee has access to 11 million files. Two-thirds of financial companies have over 1,000 open-access sensitive files. And, with remote working introducing a heightened risk, poor security controls present increased opportunities for ransomware, malware, insider threats, and non-compliance.

It comes as no surprise, then, that the cost of a data breach for financial services averaged $5.72 million - second only to Healthcare, according to IBM.

 

Image sourced from digitalguardian.com

Traditional, in-house security systems just aren't robust enough to protect against modern cyber threats or to secure hybrid and remote workplaces. All businesses - but particularly those in high-risk industries like government, finance, and healthcare - require powerful solutions that ensure compliance and facilitate swift threat detection and response.

The solution? Cloud-based security services.

Businesses that use the cloud for financial services often outsource the responsibility to security-as-a-service (SECaaS) vendors. Cloud-based SECaaS has transformed the financial industry, allowing even small businesses to take advantage of the most up-to-date security technologies. You can even use dedicated servers to customize the server to your client's needs.

What is Security as a Service (SECaaS)?

Security as a service is a cloud-based cybersecurity service provided by vendors. Much like software as a service (SaaS), it is offered through a subscription-based model.

In SECaaS, vendors take on the bulk of responsibility for a company's cybersecurity operations. They utilize the newest tools and technologies to protect companies against online threats and ensure data compliance with industry standards.

The Benefits of Using SECaaS For Financial Services

Utilizing the cloud for financial services has lots of advantages that align with modern business initiatives.

Cost-Savings

Legacy security systems are notoriously costly. Not only do you have to purchase expensive hardware and software, but you also need to finance in-house security experts. On top of that, you're financially responsible for any updates and maintenance in response to malfunctions or technological advances.

SECaaS uses a monthly subscription-based model, meaning that you only ever pay for what you need at a stable price. As well as the necessary hardware and software, any updates, maintenance, and personnel are also included in the fee. This makes SECaaS an extremely cost-effective solution for small businesses looking to maximize their security without the potentially unmanageable upfront expenses.

And of course, SECaaS means you avoid the costly effects of cyberattacks and non-compliance. This will also help you with everything from automating tax compliance to your monthly accounting reports.

For businesses who are still wary about the risk of skyrocketing cloud fees, using FinOps for financial management can help you oversee, manage, scale, and optimize all of your cloud initiatives with your finances in mind.

Access to Expertise

Cyberattacks are an imminent threat. Combatting them requires comprehensive training and continuous development, all while keeping up-to-date with dynamic cybersecurity trends and best practices.

It's a tough job, which is probably why lots of businesses are experiencing a skilled personnel shortage. Though finance is one of the industries least affected by cybersecurity personnel shortages, it's still fairly high at 78%.

 

Image sourced from microfocus.com

Utilizing SECaaS gives you access to a team of specialized cybersecurity experts on a 24/7 basis. They can not only provide you with advice and need-to-know insights, but they have all of the best security tools in their arsenal. This will not only give you peace of mind but also leaves you free to focus on other aspects of your business, such as accounts receivable management.

Always Up-To-Date

If you're using an outdated security solution or haven't installed the latest security patch or update, you're leaving yourself vulnerable to cyberattacks. Unfortunately, some businesses may not have the budget or intelligence information they need to keep up with the necessary updates.

SECaaS providers have access to the most up-to-date security tools, technologies, and intelligence. This is absolutely critical in an environment that sees threats mature at a rapid speed and outdated software exploited at scale. SECaaS allows you to take advantage of the newest updates and technologies available.

Easier Management

The siloed, complex nature of traditional security systems is one of the main reasons why utilizing the cloud for financial services has garnered such impressive popularity. In an industry where hoards of sensitive data needs to be secure, compliant, and easy to access, for example information relating to lien management, it's essential that businesses use a solution that mitigates human error.

SECaaS centralizes operations for ease of use. You can make quick, damage-limiting decisions based on real-time security insights. This will also have a direct impact on how you update your workflow software. Additionally, without the responsibility of issues such as infrastructure management, software configurations and maintenance, IT security teams have more time to analyze and implement strategic security initiatives.

Industry-Standard Security

All in all, SECaaS providers offer industry-standard levels of security and compliance.

Regulatory compliance with the likes of PCI, GDPR, CCPA, and ISO is absolutely essential for the legal, financial, and reputational sake of your company. Saying that, it's common for businesses to misinterpret, overlook, or become dangerously lax with compliance regulations.

Luckily, SECaaS providers are there to enforce compliance on your behalf. They also keep you informed of any changes or new additions, keeping you in the know and aware of any in-house adaptations you may need to make.

It's also worth noting that banking customer experience trends and reports reveal that the modern customer is actively concerned about how companies use and protect their data. Thus, demonstrable industry-standard security compliance can be used as a competitive advantage.

Security-as-a-Service Examples

If you're looking to use the cloud for financial services, here are some of the most essential SECaaS features and services to look out for.

Network Security

Your network's vulnerabilities pose a significant threat to your data. This is especially true if you have complex network architecture or lots of remote workers. To protect the integrity and accessibility of your computer network, you need robust security software that is capable of monitoring and governing network traffic.

Cloud-based SECaaS provides multiple layers of security across your physical and virtual devices. Cloud providers can implement security software, constant monitoring, access controls, and more.

Email Security

Email remains one of the most high-risk targets for cyberattacks. According to a recent Verizon report, 94% of malware-related security incidents occur through malicious emails. Other studies found that 96% of companies have been the victim of an email phishing attack, and 3 out of 4 admit to receiving an increased volume of email threats.

 

Image sourced from verizon.com

While most email service providers now boast in-built security, it's rarely enough to defend against malicious, targeted attacks. A common email security best practice is to utilize a SECaaS provider for more intricate email security. With the capability to screen and block dangerous emails, SECaaS helps protect your company from phishing, adware, and more.

Security Information and Event Management (SIEM)

SIEM is the process of collecting and aggregating log and event data from your different devices and applications to identify potential security threats.

SECaaS providers use SIEM to provide you with real-time visibility. Using SIEM, threats and vulnerabilities can be analyzed and addressed before they cause significant harm to your business.

Data Loss Prevention (DLP)

The financial industry works with particularly sensitive information, which makes data loss a critical security risk. Yet, according to Tessian, 57% of US employees working in the financial industry admit to sending an email to the wrong email address. Not only that, but a huge 91% admit to sending emails to their personal email address that can be find through an email finder.

 

Image sourced from tessian.com

Aside from employee education, what else can you do to mitigate data loss? SECaaS providers implement DLP strategies such as continuous monitoring and data verification to secure data, along with best-practice storage and backup procedures, should data loss occur.

Identity and Access Management (IAM)

Monitor and control who has access to your systems and resources with an identity and access management strategy. SECaaS vendors can provide you with the tools and advice you need to enforce the implementation of access controls, identity verification, and user management. This could include everything from single sign-on and multi-factor authentication to user behavior analytics.

Website and App Security

SECaaS can offer different layers of website and app security depending on the provider. Common services that protect your digital assets include fixing bugs, protecting against malicious bots, preventing DDoS attacks, and performing automatic updates.

Just like your email platforms, websites and apps often come with in-built security. However, companies that handle highly-sensitive information (like financial services) will often require deeper security implementations across assets like their company communication tools and file-sharing apps.

Conclusion

With 96% of businesses using the cloud for IT security, it's fair to say that the superiority of cloud services over legacy systems is common knowledge. Whether you choose to handle security operations in-house or outsource them to a SECaaS vendor, utilizing the cloud for financial services - or any service that handles highly-sensitive data - is an essential move.

For small businesses in particular, SECaaS presents ample benefits. With the ability to access the most advanced, up-to-date security technologies and intelligence, SMBs can exercise strategic cyber protection and continuous compliance without high costs or issues of limited scalability and skilled personnel shortages.

And remember, customers care about how you use their data now more than ever. If, like most financial services, your lead time formula is dependent on trust in your product, then investing in SECaaS will help you put customers' minds at ease.

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ABOUT THE AUTHOR

Grace Lau - Director of Growth Content, Dialpad 

 

Grace Lau is the Director of Growth Content at Dialpad, a contact center as a service solutions provider for better and easier team collaboration with help from features like vanity numbers from Dialpad. She has over 10 years of experience in content writing and strategy. Currently, she is responsible for leading branded and editorial content strategies, partnering with SEO and Ops teams to build and nurture content. Grace Lau also published articles for domains such as Agency Vista and IoT For All. Here is her LinkedIn.