Consumers’ views regarding the levels of security in the financial services sector highly contradicts with that of industry insiders, according to a research by Capgemini.
The study of 7,600 consumers and over 180 senior data privacy and security professionals from banking and insurance firms across eight countries revealed that banks and insurers had a significantly higher level of consumer trust regarding their systems’ cybersecurity (83%) compared to other industries. On the contrary, only one in five banking executives were found to be highly confident in their ability to detect a breach.
However, three quarters of consumers said that they would switch their provider in case of a data breach, while over a quarter of those opting to remain said that they would be cautious about further investments.
This wide gap between consumers’ trust and bankers’ confidence is alarming, especially when 65% of consumers hold trust in data privacy and security as important factors when selecting a bank.
Also, majority of consumers were found to disbelieve the idea of their own bank being breached, when in reality one in four financial institutions have reported a breach.
The study highlighted the evolving nature of the threat and lack of clarity among leaders among the key challenges to data security, and found 71% of organizations lacking a balanced security strategy or robust data privacy practices.
Capgemini global cybersecurity COO Mike Turner said: “Consumers implicitly trust banks with their money and data, but this faith is rooted in a mistaken belief their provider can be 100% secure. While banks are evolving to combat the sophisticated threat cybercriminals pose, public understanding of the threats and challenges remains low.”
The study also revealed a low level of preparedness among financial institutions to implement the General Data Protection Regulation (GDPR) legislation that will be effective in May 2018 and will compel organisations to disclose data breaches within 72 hours or face large penalties. Only one-third (32%) of the respondents said that their organisation was making strong progress in implementing the guidelines.
Capgemini global head of financial services, insights & data, Zhiwei Jiang said: “When GDPR is introduced and all breaches are likely to be made public soon after they occur, many people will be in for a surprise.
“The introduction of GDPR legislation next year is a prime opportunity for business transformation for banks and insurers to become the digital fortresses consumers believe them to be.”