In the ever-evolving landscape of cyber threats, financial firms are facing increasing challenges posed by cyber criminals leveraging Artificial Intelligence (AI)-powered tools. The recently launched Digital Threat Report, 2024, by India’s Ministry of Electronics and Information Technology (MeitY) sheds light on the vulnerabilities in the cybersecurity systems of the Banking, Financial Services, and Insurance (BFSI) sector. Prepared in collaboration with Indian Computer Emergency Response Team (CERT-In), Computer Security Incident Response Team in Finance (CSIRT-Fin), and SISA, a global cybersecurity company, the report examines current and emerging cyber threats and defense strategies.
The report highlights a concerning trend where cyber attackers are using AI to exploit weaknesses in the security posture of financial institutions. With the average cost of a data breach climbing to $4.88 million globally in 2024, and $2.18 million in India, the stakes have never been higher. The report predicts that AI-driven cyber attacks will become one of the most scalable and adaptable threats by 2025, challenging traditional defense mechanisms and necessitating innovative countermeasures.
One of the key findings of the report is the rise of social engineering and credential theft as dominant threats in the cybersecurity landscape. Attackers are increasingly utilizing AI tools to craft personalized lures and deceive individuals into disclosing sensitive information, such as bank account credentials. The report also mentions the growing availability of “deepfake as a service” platforms, which enhance the effectiveness of Business Email Compromise (BEC) attacks by allowing attackers to convincingly impersonate executives.
Phishing attacks, accounting for 25% of initial infection vectors, have also been highlighted in the report. Cyber criminals use various tactics, including the dark web, malware, and phishing campaigns, to extract sensitive information like usernames and passwords, enabling them to bypass multi-factor authentication and gain unauthorized access to critical systems.
The report underscores how AI is facilitating cyber criminals in executing sophisticated attacks with ease. Malicious AI models like FraudGPT and WormGPT empower even less skilled perpetrators to craft convincing phishing emails, generate malware, and exploit vulnerabilities. Moreover, attackers are diversifying file formats in phishing campaigns, exploiting supply chain vulnerabilities, and targeting organizations with inadequate cloud configurations.
To address these evolving threats, the report offers recommendations for policymakers and organizations in the BFSI sector. Policymakers are urged to prioritize cybersecurity as a technocommercial business decision, empower Chief Information Security Officers (CISOs), harmonize security standards for digital payments, and foster a skilled workforce in digital payment security. Organizations are advised to enhance resilience in key domains of people, process, and technology.
Looking ahead to 2025, the report warns of emerging threats such as deep fakes, supply chain attacks, LLM prompt hacking, adversarial LLMs, and challenges to cryptography. It emphasizes the need for a responsible AI framework in the BFSI sector and proactive measures to mitigate cyber threats.
In conclusion, the Digital Threat Report, 2024, underscores the critical importance of staying ahead of cyber threats and adopting proactive measures to safeguard the BFSI sector. With AI-powered cyber attacks on the rise, a collaborative effort between policymakers, cybersecurity experts, and organizations is essential to defend against evolving threats and ensure the security of financial systems.