Fintech companies are banks’ only salvation if they are to fix security challenges that persist because of legacy IT systems and infrastructure, The Bunker says. Its CTO, Phil Bindley, says fintech companies can create safer services, reducing both technical issues and cybercrime.
“The issue of bank IT resilience and security is more prevalent than ever,” Bindley says.
“Hackers have become increasingly advanced in their tactics and many banks are encumbered by ageing legacy technology, meaning are not up to the challenge of effectively mitigating security risks. Financial institutions need to match end user experience with resilient security, but it is becoming increasingly difficult for them to do so due to the rapid pace of the digital economy. Although these systems cannot be transformed overnight, the cost of not doing so is growing day on day and could result in exposing the public to unnecessary risks.”
Bindley says fintech companies can disrupt the traditional finance sector with ‘ambition and innovation’, and that their use of creative new software is already making a mark in the industry.
“The challenge for Fintechs is demonstrating that they are a sound investment as implementing technological solutions within the financial sector certainly comes with complexities. The evolving regulatory landscape and the demand for robust risk management mean that Fintechs need to be able to demonstrate the security requirements and compliance mandates of their customers.”
As for what financial institutions must do, Bindley says they need to do their due diligence to make sure fintech companies they want to work with comply with all the necessary rules and regulations.
“Once banks have the confidence that the environment, systems and services are completely secure and fully compliant the end result will be better and safer services delivered to customers,” concludes Bindley.
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