A cyber security threat refers to any possible malicious attack that seeks to unlawfully access data, disrupt digital operations or damage information. COVID-19 has come as a jolt to many sectors, including India’s burgeoning digital payments industry. As per statista, digital payments saw a sudden hike in the times of coronavirus pandemic. Digital payments are rapidly becoming an essential part of our lives due to social distancing norms. Digital Payments is going to evolve and innovate drastically in the upcoming years.
But this change will also come with its fair share of challenges.
What are the challenges in digital payments?
1. Issues of Cyber Security
In today’s interconnected world, cyber security has become a critical concern for individuals, businesses, and governments alike. With the rapid advancement of technology, the threat landscape continues to evolve, making it essential for everyone to understand the fundamentals of cyber security. This article delves into the key aspects of cyber security, including its importance, common threats, best practices, and future trends.
The increase in the usage of digital payment solutions has also created risks such as frauds, information theft, malware attacks, virus attacks, etc., Majority of people of India have been facing the issues of Cybersecurity. RBI has also issued some guidelines related to secure financial transactions in the country. It has also taken the necessary steps to secure card payments, Net Banking, and ATM transactions.
Cyber security is not limited to large corporations or government agencies; individuals are equally at risk. From personal banking details to social media accounts, every online interaction carries potential vulnerabilities that cybercriminals can exploit.
2. The rise in Digital Payment frauds
The rise in digital payments during the COVID-19 pandemic has also faced different kinds of online fraud.
Digital payment fraud is any kind of false transaction completed by a cybercriminal by illegally accessing the customer data.
Let’s discuss the types of different digital payment frauds :
Identity Theft – Identity theft is a fraud where the hackers steal the personal information of consumers for making illegal payments. Since the fraudsters can access the personal data of the consumer, they can easily bypass the firewalls and the e-commerce site will be unable to differentiate between the hacker and the actual user.
Phishing – Phishing is the most popular method of illegally accessing the emails and hackers will ask you to provide sensitive information such as net banking or credit card details. As the sources are unknown, your data will get hacked used in making fraudulent online payments.
Fraudulent Schemes or offers – Sometimes a fake website asks you for a little down payment and promises you to give more money after it. In this way, they will misuse your card details for making fraudulent payments.
3. Lack of digital literacy
Digital payment systems operate across hardware and software platforms like credit card payment processors and user interfaces.
Credit card-affiliated payment processors are often expensive in facilitating digital payments.
Sometimes there is a lack of interface between processing systems that can also lead to payment delays, missing transactions, and expensive fees.
How you can secure your digital payments?
Distribute the risk instead of concentrating
The demand for digital payment solutions is emerging across the globe, which requires the latest technologies and robust payment infrastructure. The government needs to store all the data to cope up with this demand, which will make the info susceptible to cyber threats and attacks, as against distributing it across different infrastructures across the globe.
Concentrated storage will also increase the risks of data theft by hackers. While on the other hand, distributed data-sets sort of a cloud can make the data less vulnerable against viruses or malware attacks and secured if one in each of the jurisdictions wherever its hold on faces threat, whereas the overall breach contained in one location by not providing access to information sets.
Moreover, while going cashless will be beneficial for the nation, it requires the rapid building of a safe and secure digital payments infrastructure to facilitate this change at the back end, which may only happen if data is allowed to flow across borders.
Why is Cyber Security Important?
The increasing reliance on digital platforms has made cyber security indispensable. Here are some key reasons why cyber security matters:
1. Protection of Sensitive Data Personal, financial, and corporate data are prime targets for hackers. A single breach can lead to identity theft, financial losses, and reputational damage. Strong cyber security measures help prevent unauthorized access to sensitive information.
2. Safeguarding National Security Cyberattacks on critical infrastructure—such as power grids, healthcare systems, and defense networks—can have catastrophic consequences. Governments invest heavily in cyber security to protect national interests and maintain public safety.
3. Business Continuity For businesses, a cyberattack can disrupt operations, lead to financial losses, and erode customer trust. Robust cyber security frameworks ensure that organizations can defend against threats and recover quickly from incidents.
4. Compliance with Regulations Many industries are subject to strict data protection laws, such as the General Data Protection Regulation (GDPR) and the Health Insurance Portability and Accountability Act (HIPAA).
Provide security to end-users with a proper framework
Sensitizing users about the safe usage of digital payment solutions are necessary for creating awareness about payment frauds and risks. Fraudsters tend to take advantage of users’ unawareness through identity impersonation and phishing for sensitive information.
It’s very important for the users to not disclose their OTPs or PINs to anybody. Malware attacks are yet another serious issue for cybersecurity in India. Hackers can easily access net banking and credit card-related details via E-mails or SMS, which may cause serious data breaches.
We have to make efforts to increase digital literacy by providing end to end security to the concerned parties. The users also need to take care before opening any suspicious email or link as it may be a threat to their digital payments.
Leverage the technology to secure your digital payments
We can leverage the technology in bolstering cybersecurity by adopting new payment methods and technologies.
Adoption of new payment methods like contactless cards, QR codes, and tokenization will also keep the digital payments simple and secure.
Contactless cards are a faster and safer way to make digital payments in the times of COVID-19.
QR codes are secure and inexpensive which can be used in digital platforms and social media apps.
Latest technologies like 3D secure and biometric authentication, will create a strong defense against an unauthorized person and also improve the authentication methods.
Effective utilization of Artificial Intelligence can curb any irregularities in the payment process and take the right preventive measures at the right time.
In biometric authentication, the user’s fingerprint gets stored in a secure chip, which will match the scanned fingerprint with the stored one. The biggest advantage of biometric authentication is that the bank or merchant cannot access the data of consumers.
Why is Cyber Security Important?
The increasing reliance on digital platforms has made cyber security indispensable. Here are some key reasons why cyber security matters:
1. Protection of Sensitive Data Personal, financial, and corporate data are prime targets for hackers. A single breach can lead to identity theft, financial losses, and reputational damage. Strong cyber security measures help prevent unauthorized access to sensitive information.
2. Safeguarding National Security Cyberattacks on critical infrastructure—such as power grids, healthcare systems, and defense networks—can have catastrophic consequences. Governments invest heavily in cyber security to protect national interests and maintain public safety.
3. Business Continuity For businesses, a cyberattack can disrupt operations, lead to financial losses, and erode customer trust. Robust cyber security frameworks ensure that organizations can defend against threats and recover quickly from incidents.
4. Compliance with Regulations Many industries are subject to strict data protection laws, such as the General Data Protection Regulation (GDPR) and the Health Insurance Portability and Accountability Act (HIPAA).
Common Cyber Security Threats
Cyber threats come in various forms, each with unique methods of exploitation. Some of the most prevalent threats include:
1. Malware Malicious software, or malware, is designed to damage or gain unauthorized access to systems. Common types include viruses, ransomware, spyware, and trojans. Malware can be spread through email attachments, malicious websites, or infected software downloads.
2. Phishing Phishing involves fraudulent attempts to obtain sensitive information, such as login credentials or credit card details, by impersonating legitimate entities. These attacks often come in the form of deceptive emails, text messages, or fake websites.
3. Man-in-the-Middle (MitM) Attacks In MitM attacks, cybercriminals intercept communications between two parties to steal data or manipulate transactions. Unsecured Wi-Fi networks are a common target for these attacks.
4. Denial-of-Service (DoS) Attacks DoS attacks overwhelm a system or network with excessive traffic, rendering it inaccessible to legitimate users. Distributed Denial-of-Service (DDoS) attacks involve multiple compromised devices, making them harder to mitigate.
5. SQL Injection This attack exploits vulnerabilities in a website’s database by injecting malicious SQL code. Hackers can gain unauthorized access to sensitive data, modify records, or even delete databases.
6. Zero-Day Exploits Zero-day vulnerabilities are unknown software flaws that hackers exploit before developers can patch them. These attacks are particularly dangerous because they occur before a fix is available.
Cyber Security Best Practices
Adopting strong cyber security measures can significantly reduce the risk of cyber threats. Here are some essential best practices:
1. Use Strong Passwords and Multi-Factor Authentication (MFA) Weak passwords are a common entry point for attackers. Use complex, unique passwords for each account and enable MFA for an additional layer of security.
2. Keep Software Updated Regularly update operating systems, applications, and security software to patch vulnerabilities that hackers could exploit.
3. Be Wary of Suspicious Emails and Links Avoid clicking on unknown links or downloading attachments from unverified sources. Verify the authenticity of emails before responding or providing information.
4. Secure Your Network Use firewalls, encryption, and Virtual Private Networks (VPNs) to protect data in transit. Avoid using public Wi-Fi for sensitive transactions.
5. Backup Data Regularly Regular backups ensure that critical data can be restored in case of ransomware attacks or system failures. Store backups offline or in a secure cloud environment.
6. Educate Employees and Users Human error is a leading cause of security breaches. Training employees and users on cyber security awareness can help prevent accidental data leaks.
Future Trends in Cyber Security
As technology evolves, so do cyber threats. Emerging trends in cyber security include:
1. Artificial Intelligence (AI) and Machine Learning AI-powered security tools can detect and respond to threats in real-time, improving defense mechanisms. However, cybercriminals may also use AI to develop more sophisticated attacks.
2. Quantum Computing Risks Quantum computers could potentially break traditional encryption methods, necessitating the development of quantum-resistant algorithms.
3. Increased Focus on IoT Security With the rise of Internet of Things (IoT) devices, securing interconnected smart devices will become a priority to prevent large-scale breaches.
4. Rise of Cyber Insurance More businesses are investing in cyber insurance policies to mitigate financial losses from cyber incidents.
5. Regulatory Changes Governments worldwide are expected to introduce stricter cyber security regulations to combat growing threats.
Cyber security is an ever-evolving field that requires continuous vigilance and adaptation. By understanding the risks and implementing best practices, individuals and organizations can better protect themselves against cyber threats. As technology advances, staying informed and proactive will be key to maintaining a secure digital environment for all.
Wrapping Up
The COVID-19 pandemic has accelerated the adoption of digital payment solutions, drawing more attention towards the need for safety and security in the world of payment landscape. And, we are sure to see more innovation and disruption in this space.
Today we need an effective digital payment solution backed by robust security measures. The digital business landscape is constantly changing and you have to evolve and bring in new technologies to drive the goal of becoming a ‘cashless’ economy.
There are two ways of developing an app for your business, the first one is you can hire an app developer, and the second one is to extend your dedicated software development team.
Author’s Bio – Nikunj Gundaniya, Product manager Digipay.guru, one of the leading Digital wallet solutions, which provides mobile finance application development services. He is a visionary leader whose flamboyant management style has given profitable results for the company. He believes in the mantra of giving 100% to his work.
