How Security Acts as a Competitive Advantage for Financial Management Firms

Cybersecurity is a matter of great concern, especially for the financial services sector. Having adequate cybersecurity and a coherent security policy in place helps to protect your assets and keep your clients sensitive information secure.

Cyberattacks are on the rise, and financial management firms are often targeted. But how can you not only protect against the threat of cyberattacks but also add value for your clients? 

How can I use cybersecurity as an advantage? 

Remember, security doesn’t just protect your reputation and operations. It can also be a huge differentiator, helping you stand out from other financial management firms.  

You need to be able to show that you’re safeguarding data, so your clients can be confident that their information is protected. It’s important to position your business as one that promotes good cybersecurity standards, and this in itself will help build trust among clients. 

Demonstrating to clients that you care about the security of their personal details will help to reassure them that you are looking after their needs and will also give them added value. Taken additional cybersecurity measures can therefore help with client retention by showing them that you accept responsibility for looking after the data held on your information systems. 

So, there’s a strong case for financial management firms to employ hardened security practices. If you’re put off by what it may cost you to invest in cybersecurity, then consider how much doing nothing about your security could cost you in both the short-term and the long-term. 

Having good IT security should therefore be viewed as a brand asset and a competitive advantage, as well as a way to minimise the risk of potential disaster. Cyberattacks can damage your brand reputation and negatively impact customer satisfaction as well as costing you a lot of time, resource, and money. 

What are the main ways your firm can be compromised?  

  • Account compromise – phishing emails 
  • Insider threat – whether deliberate or accidental, a lot of cyberattacks that take place are by employees. Education can help – more on that later. 
  • Ransomware – malicious software that encrypts the computer system. The attacker then demands money (a ransom) to remove it. It’s often advisable not to pay them and to have a response plan in place to limit damage instead. 
  • Misconfiguration misconfiguration attacks exploit weaknesses in the web and application servers to gain access to sensitive data, such as files. 

How can I protect my business from cyberattacks? 

When it comes to protecting your firm from cyberattacks, there are several measures you can take. Different measures will counteract different types of potential cyberattacks. However, all the below measures can help to enhance the cybersecurity of your firm and will give you a competitive advantage in your industry. Adopting a multi-layered approach to security helps to improve protection against cyberattacks. The more layers there are, the lower the chance of an attack. 

  • To protect emails from cyberattacks, you should use email encryption. Email encryption is used to send sensitive information to clients when you’re not using your back-office system, such as Intelliflo to send information to clients. 
  • Enterprise email security (business grade spam protection) can be obtained, which ‘bolts-on’ to your email, to stop potentially dangerous emails from even getting into your inboxes. 
  • File encryption is also beneficial, as it helps to protect data held within folders and attachments. This cybersecurity measure can prevent data breaches and malware attacks. Encrypting files using software is also relatively straightforward. Hard disk encryption is where the whole disk is encrypted, so if a laptop is lost or stolen, then data can’t be read. On Apple, this software is called FileVault, whereas for Windows BitLocker is available. 
  • Two measures you can take to protect your passwords are: using a password manager and implementing two-factor authentication, so a code is sent to the employee’s mobile number as part of the login process. Two-factor authentication will ensure that emails require an added security stage, as the code to login can only be accessed on the specific mobile number connected to the relevant email address. 
  • Ensure you have appropriate security software on all your devices, to protect against the latest threats, such as ransomware.  Not all antivirus software is equal in its effectiveness, so get one that gives the option to revert back to the device’s settings before the problem began. 
  • Education: one of the strongest ways to avoid cyberattacks is to ensure that your employees are well-trained when it comes to IT security. Ensure they know what to include to create a strong password, ways to browse safely online, and why two-factor authentication and encryption methods are necessary. 
  • Make sure all devices are being kept up to date: making sure your software remains up-to-date significantly lowers your risk of a data breach, as most malware will look for unpatched vulnerabilities. 
  • A resilient backup strategy. 
  • Cyber Essentials certification – The Financial Conduct Authority (FCA) also stress the need to ‘put good governance in place’ and to work towards existing standards including the NIST Cybersecurity Framework, NCSC’s 10 Steps to Cyber Security, and Cyber Essentials. So, having this certification will be beneficial. 

The above tips are good starting points for minimising the risk of cyberattacks. 

Overall, the best form of protection against cyberattacks is to invest in cybersecurity and have a comprehensive IT strategy. This will help you to protect your digital assets, as well as safeguarding client information, which shows clients that you appreciate how important it is to keep their data secure. 

We’re currently offering financial planning and wealth management firms an FCA based cyber-crime prevention and recovery assessment. There’s no cost for our advice. You can book an initial 15-minute chat with Mark here