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6 Ways to Fortify Your Network Defenses in the Age of IoT and Connected Devices

6 Ways to Fortify Your Network Defenses in the Age of IoT and Connected Devices

IoT presents a multitude of opportunities for financial institutions to efficiently serve their clients. Yet the convenience of IoT solutions comes at a cost. It’s a technology that opens up a financial firm’s network to security risks and vulnerabilities. A compromised IoT device or data from an IoT device transmitted to a firm’s network through an unsecure connection could lead to security breaches.

As financial institutions embrace IoT and the world of connected devices, they need to take steps to strengthen their network’s security and ensure the privacy and safety of data sent to and from these devices. IoT holds great promise for financial organizations, but it’s crucial to assess how to securely deploy these innovative solutions and enhance network security before integrating new technologies.

Let’s take a look at how financial institutions can benefit from IoT and a few examples of use case scenarios for firms. We’ll also discuss network management best practices for financial organizations looking to take advantage of IoT technology.

Enabling a More Connected Financial Services Industry: Opportunities in IoT

Enabling a More Connected Financial Services Industry: Opportunities in IoT

The increasing use of IoT devices and applications is driving the need for an IoT-enabled financial services industry. The market size of IoT in the financial services industry is projected to grow at a compound annual growth rate of 52.1 percent between the forecast period of 2018 and 2023. This growth is expected to continue as the emerging IoT industry advances.

So how can financial organizations take advantage of IoT technology? Here are benefits that financial institutions gain when adopting IoT solutions and practical examples of how firms can implement the technology:

  • Cost-effective strategies: Financial organizations are using IoT technology to determine locations for new branches and identify which branches should be closed, remain open, or operate on reduced or extended opening hours. To do this, financial institutions deploy sensors that track foot traffic and other location data that are then used to make strategic decisions.
  • Seamless customer experiences: Financial firms are harnessing IoT technology to provide a more seamless experience for customers. For instance, organizations deploy sensors that measure foot traffic in specific areas and use this data to optimize the placement and number of ATMs in these areas.

    Citibank is using beacon technology to turn a customer’s smartphone into a “key” that unlocks an ATM lobby door, enabling cardless ATM access. Meanwhile, Bank of America partnered with FitPay to allow customers to make secure contactless payments using IoT and wearable devices.
  • Personalized customer service: With IoT technology, financial institutions are able to deliver tailored services to clients. For example, organizations employ beacon technology coupled with geofencing to pinpoint a customer’s location and send custom notifications and offers to their mobile device.
  • More informed decision-making: Many financial institutions take customer data from IoT devices and combine it with other data sources for analysis. The insights gleaned from data analysis are then used to inform the decision-making process.

There will be limitless ways for financial institutions to leverage IoT capabilities as the technology matures. Before adopting IoT solutions, firms need to consider the appropriate use cases for their organization, harden network security controls, and enhance network security practices to keep their data and network safe from threats.

Network Management for Financial Institutions

Network Management for Financial Institutions

Despite the many possibilities that IoT holds for financial institutions, the technology also poses potential threats. A huge majority of financial firms (93 percent) agree that IoT is the greatest security threat facing organizations, according to Verizon’s 2018 Mobile Security Index.

To combat the risks presented by IoT, it’s essential for financial organizations to strengthen their network security. Here are ways financial institutions can secure their networks while leveraging IoT solutions:

  1. Employ network segmentation to segregate IoT devices from your firm’s network.

    Isolating IoT devices from your financial organization’s wider network mitigates the risk of infecting other parts of your network. In case of a cybersecurity attack on an IoT device or application, the threat is limited to the IoT-segmented network zone and can be better controlled.
  1. Implement strong encryption for data transmitted to and from IoT devices.

    Encryption is a must-have for IoT devices and applications handling critical data. It’s imperative for financial institutions to encrypt any data that IoT devices hold and to ensure that data is encrypted in transit and at rest.

    Your firm can even take it one step further by establishing an encrypted VPN connection between IoT devices and your network. This adds another layer of security against cyber threats that compromise the integrity of data transferred between connected devices and your financial organization’s network.

  2. Administer the same security controls you have on your existing network to IoT deployments.

    It’s important for financial firms to enforce the same security controls they have on their current network to their IoT-segmented network zone. This includes firewalls as well as rigorous authentication procedures and access control policies.

    For instance, traffic between an IoT device and a firm’s network is permitted only through an explicitly-approved port and IP address, blocking all other network traffic to and from the device. Additionally, provisioning security credentials or certificates for IoT devices then validating these credentials upon access allows only known and trusted IoT devices and applications to connect to a financial organization’s network.

  3. Conduct periodic penetration tests.

    Penetration testing helps detect vulnerabilities in IoT devices and in any applicable network zones. It’s important to run penetration tests on a regular basis to protect against new and existing threats, especially in the rapidly evolving world of IoT and connected devices.

  4. Plan for security patches and updates.

    Because of security challenges stemming from IoT-enabled and other endpoint devices, vendors are frequently releasing security patches and updates. Before applying them, financial firms would do well to assess the impact of patches and updates on their network. Some patches may not be applicable and could actually open up your network to security breaches.

    Test any patches or updates before deploying them, and establish a rollback plan in case of any issues. The FFIEC provides valuable guidance on patch management for financial institutions.

  5. Work with a trusted partner.

    When it comes to integrating new technologies like IoT into your financial organization’s network, know that you’re not alone. A trusted partner can guide you through the process, recommending the right solutions and helping you leverage innovative technologies while boosting your network’s defenses.
With the proper network security practices in place, your financial institution can readily take on the world of IoT and connected devices without compromising security.

Trust DataComm to help you manage your financial institution’s network while integrating the latest and most effective technology. We offer network management and network security services to help your organization adopt innovative solutions securely. Contact us today to find out how we can help.

 

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