Delivering the digital banking disruption

by Iwan Price-Evans on Security • August 10, 2021

Digital transformation is rapidly changing industries across the globe. Banking faces perhaps the biggest transformation of all. 

In previous decades, high-street banking customers formed close ties with their local branch and often a personal relationship with their bank manager. More recently, as banks have closed local branches, queues have grown longer and longer, and demographic change has produced a cohort of banking customers increasingly comfortable managing money online, people have turned their backs on traditional banks.

Many people no longer want to step inside a bank or meet their bank’s staff. Banks must be able to deal with everything online, or via an app, or customers will take their business elsewhere. Banks must also innovate, using new technology to increase accessibility and responsiveness, provide new service offerings, and put more power in the hands of banking customers.

New technology, new competitors

This push to digitize the banking space is causing many banks to embrace digital transformation faster than ever. It is also shaking up the banking space as many tech-savvy smaller players are now entering the scene. 

With banks no longer requiring expensive branches or machines at every possible location (complete with thousands of expensive staff) they can now provide a similar banking experience online to a global audience at a far lower cost This makes the industry more viable for smaller new competitors and allows these smaller companies to evolve faster because they do not have any legacy technology to hold them back.  

These so-called “Challenger Banks”, as a report from CbInsights refers to them, are rapidly changing the global financial services landscape, and those traditional big banks that don’t embrace technological innovation fast enough might find themselves losing out on their share of the banking market.

At the center of this disruption in the banking space is the growth of cloud computing, and modular Banking as a Platform (BaaP) technologies, as these smaller banks leverage the power of the cloud and open APIs to craft innovative services as fast as possible without requiring their own data centers or even their own transactional processes. The cloud also frees them from the constraints of local branches or expensive infrastructure. They can scale services to cloud endpoints around the globe and reach customers they might never have reached before.

 

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The security challenge

This does not come without its challenges. In particular, the rising threats of fraud, data leaks, and intrusions mean none of these companies – no matter how small – can afford to compromise on security and compliance. 

The proliferation of endpoints and banking microservices and potentially rapid expansion into new markets exposes digital banking to increased risk. The attack surface gets bigger, visibility is harder to maintain, and complexity breeds vulnerability. 

Security failures can lead to massive fines and reputational losses. For a plucky new banking startup, this could destroy their growth plans, nascent customer base, and investment strategy.

Centralized visibility and security

Digital banking startups and traditional banks embracing digital transformation can protect themselves and scale faster by adopting a centralized visibility and security solution like Nova ADC

  • Provides full Layer 7 security across any application deployment environment: VMs, cloud, edge, and containers
  • Includes a fully PCI-compliant WAF 
  • Protects against the OWASP Top 10 vulnerabilities
  • Scans every node to ensure applications meet security best practices
  • Authentication and access management
  • Uses advanced machine learning (ML) to profile traffic and respond autonomously to emerging threats 
  • Uses GSLB to improve the performance and scale of banking applications, proactively adjusting the load to meet demand across multi-cloud and multi-location ecosystems.

While many ADCs on the market can ensure a high level of security at an individual node level, Nova goes one step further by also keeping track of the load and usage across every node in the system allowing it to defend against bots, scrapers, data leaks, spammers, SQL injections, XSS attacks, denial of service and other measures.

It can do this intelligently and proactively before you even realize there is a problem, saving your company crucial time and resources in its ability to provide security at a global scale.

Any new “Challenger Bank” looking to enhance their ability to deliver high-performance software needs a provider that can help keep their infrastructure operational and secure. Try Nova ADC free and Snapt will help you get started.

 

Snapt CTA: Security and load balancing for banking services