How fintech is changing the financial industry is to no one’s surprise, but unfortunately, it also comes with an opportunity to commit fraud. In fact, the fintech industry might be at its highest risk possible this year.
According to last year’s report from Entrust, advanced fraud techniques will continue to mark financial services as their prime target. Cryptocurrency platforms, to be precise, saw a staggering 50% increase in fraud attempts over the past year.
Without strengthening fintech cybersecurity, frauds will put a final push to the financial services’ bankruptcy. As such, you need to learn about common frauds that haunt fintechs and how to deal with them.
Common Fraud & Attack Types in the Fintech Industry
There have been many fintech frauds or fintech scams throughout the history of the fintech industry. Let’s delve into more advanced but common fraud and attack types that can give a burden to many financial services:
Overlay Attacks
One of the common attack types that can pose fintech cybersecurity risks involves overlaying a fintech app. This method allows fraudsters to steal by luring victims to input their credentials in seemingly harmless login screens. Here’s how an overlay attack works:
- First, they need to know the fintech application that the victim uses and find out the application’s package name.
- Then, fraudsters need to be able to detect a foreground activity of the targeted fintech app. They have to monitor the activities currently in the foreground.
- Once the foreground activity is detected, they need to hack it by injecting malware into the victim’s device. This allows an activity above the real app to which the unsuspecting victim will input their login credentials into.
Of course, once fraudsters gain the login information from the victim, they can easily take over the account. Knowing how account takeover has been damaging to the financial and reputational health of the affected fintechs, this attack cannot be left unchecked.
Rooting/Jailbreaking
People love rooting their devices for full control of their phones, but is it worth the risk? As of today, a rooted or jailbroken device can pose a great danger, especially if the device has been installed with fintech apps.
The reason is quite simple. By performing rooting on a device, users intentionally bypass any kind of protection that is meant to protect the installed application and their data.
Without any protection, any fraudsters can easily make their way to the rooted device. They can access and compromise data, causing yet another financial and reputational damage to the financial technology industry.
SSL Pinning
Secure Socket Layer (SSL) used to be a solid protocol to strengthen security in the fintech industry, mainly to protect against man-in-the-middle (MitM) attacks. Unfortunately, this has been unused due to its many vulnerabilities.
Present-day fraudsters can easily exploit these vulnerabilities to intercept the communication between victims and the service. This can damage financial services that are supposed to prioritize security above all else.
Keylogging Attacks
Account takeover can also be done by using keyloggers on the victim’s device. Keylogging, or keyboard logging, is a fraud attempt by logging (recording) the keys that the victim presses on the keyboard. This can be done by injecting malware designed to log the keys.
To get this keylogger malware to the victim’s device, unaware victims must have downloaded it without their consent by visiting a harmful site. Once downloaded, this malware will begin to record every stroked key.
For example, if the victim manually types their login credentials, keylogger malware will record it and send it to the fraudster. Easy access to the victim’s fintech account, and the victim is unlikely to be aware of this process.
Keypaz: The Best Solution for Preventing Fraud in the Fintech Industry
Those examples above are just a few of many fraudulent methods to wreak havoc on any financial technology industry. To combat this, financial services need a powerful fraud prevention that can stand between them and this disastrous scenario.
Make no mistake, Keypaz is here to provide real-time fraud protection to detect and stop fraud before rampaging your business. It has advanced tools like device intelligence, app insights, and biometric behavioral analytics that allow businesses to:
- Detects anomalous behaviors that can be a sign of phishing attempts and overlay attacks, thanks to screen sharing and debugging detection.
- Blocks rooted or jailbroken devices from running fintech apps using emulators and rooted device detection.
- Identifies keylogging attempts and suspicious login behaviors that can compromise security using behavioral analytics.
As a way to survive a continuous onslaught from fintech frauds, Keypaz is the only tool that helps businesses to stop fraud and avoid the risks. Without real-time protection, financial services will be just sitting ducks.
Key Takeaways
The key takeaway here is that fintech cybersecurity risks are a real deal that cannot be left ignored. There are countless methods to commit this fraud, and as time keeps moving forward, there can be many new types of advanced fraud on their way.
Now that real-time protection like Keypaz exists to help the fintech industry solidify their defenses, don’t wait for fraudsters to come to your services first. Use Keypaz to save your financial service before it’s too late!