More than three-quarters of financial institutions admit to being breached in past 2 years; Many consumers say they’d change banks if losses aren’t covered or the bank failed to provide timely response
The financial services sector is the most proactive when it comes to investing in and focusing on information security, yet more than one-third of consumers say their personal bank accounts have been compromised and almost 8 in 10 financial institutions admit to being breached in the past 2 years, according to a new KPMG study: “Consumer Loss Barometer: Banking and Financial Services Cybersecurity.”
In addition, the vast majority of consumers say they would change banks if their institution didn’t take the proper steps to re-mediate a cyber-attack.
“Financial institutions have a real opportunity to solidify trust with their customers by demonstrating that security is a strategic imperative, and that they are taking every possible precaution to protect consumers,,” said Jitendra Sharma, Advisory line of business leader, Financial Services. “Consumers have a lot of options in this environment, so companies must get it right as the battle for customers is fierce.”
The KPMG survey of 449 banking consumers, found that 37 % would move to a new institution if the bank refused to cover their losses. Thirty percent said they would leave if the bank did not provide timely acknowledgement or response to an incident.
Consumers surveyed by KPMG indicated that there are several steps banks can take to alleviate their concerns, most frequently citing a guarantee to cover losses (74%), frequent communications and updates (38%), and providing a free credit report (35%).
In conjunction with the consumer survey, KPMG conducted a survey of 400 senior cybersecurity executives, including 100 in financial services, distributed evenly between chief information officer (CIO – 25%), chief information security officer (25%), chief security officer (25%), and chief technology officer (CTO – 25%).
KPMG found that the financial services sector was the most proactive of all the sectors. Sixty-six percent of finance executives indicate that their companies have invested in information protection in the past year – well ahead of their peers in other sectors. In fact, 64 % of executives say their companies dedicate more than 10% of their annual IT budget to information protection initiatives. In addition, 85 % say they have a leader in their company whose sole role is information security – again, ahead of other sectors KPMG polled.
“It is encouraging to see that financial institutions are clearly making the investment in information security and are ahead of their peers from other sectors,” said Charles Jacco, Advisory principal, Financial Services. “But in order to retain loyal customers and attract new ones, they will need to continue demonstrating their commitment and ability to protect their customer’s assets and to put their minds at ease.”