2FA: Still FinTech’s Best Defense Against Cybercrimes in 2023Cyberattacks remain among the FinTech sector’s most significant challenges. As the industry’s international scale and digital interconnectivity continue to grow, FinTech is becoming an increasingly lucrative target for cybercriminals. Ransomware […]
Cyberattacks remain among the FinTech sector’s most significant challenges. As the industry’s international scale and digital interconnectivity continue to grow, FinTech is becoming an increasingly lucrative target for cybercriminals.
Ransomware is one of the industry’s leading cybersecurity threats, with 64% of financial institutions reporting a ransomware attack this year. Distributed denial of service (DDoS) and phishing attacks are other cybercrimes FinTech organizations face.
By 2025, these attacks will cost companies up to $10.5 trillion annually. They can damage a business’s reputation, erode partners’ and customers’ trust, and even lead to hefty legal fees.
The backbone of any reputable FinTech brand is robust security. While two-factor authentication has been used for over a decade, this security method is anything but obsolete and can still prevent the majority of cyberattacks affecting FinTech firms.
What is 2FA?
Two-factor authentication is an identity and access security process that requires customers to provide two different types of authentication to access their accounts. 2FA adds a second layer of security by using passwords in addition to SMS codes, email verifications, or biometrics.
The 2FA security factor typically includes:
- Something only the customer knows, like their mother’s maiden name
- Something the customer has, such as a cell phone number or application
- A customer’s unique physical traits, like facial features
Why is 2FA still important?
Cybercriminals have become much more sophisticated in recent years. By itself, a password can be easy to break. About 90% of them can be cracked in just six hours. Additionally, two-thirds of customers use the same password for all logins. As such, FinTech companies cannot rely on even the strongest passwords to securely grant customers access to their accounts.
2FA benefits both FinTech businesses and their customers by:
- Significantly reducing the risk of data breaches and fraud
- Keeping sensitive information safe
- Achieving and maintaining compliance
- Reducing password fatigue
- Boosting brand trust and loyalty
To obtain these benefits, FinTech firms must follow several 2FA best practices.
2FA best practices for FinTech
Use the following tips to ensure your FinTech company implements 2FA efficiently.
While 2FA isn’t a new trend, some consumers may not have used it before. Create educational content, such as a blog, FAQ page, or newsletter, explaining what 2FA is and its benefits. Share this information with both new and existing customers.
For smooth onboarding, provide clear instructions for users to set up their 2FA accounts. Develop a step-by-step guide that includes visuals or short video tutorials.
Don’t forget to send customers regular updates and reminders about 2FA best practices, or any policy changes.
Enable 2FA for all users
After educating customers, enable 2FA for all of them, without exception. Financial service companies must have a full 2FA deployment for impenetrable protection against cybercrimes.
Have a zero-trust security policy.
Two-factor authentication should be part of, not all of, your FinTech’s firm security processes. A zero-trust security architecture is a strategic approach that entails a business not trusting any user, device, or application by default. Always abide by the principle of “never trust, always verify.”
Mandate strong passwords
While 2FA uses two types of authentication, it doesn’t mean that your customers can still skimp on their password complexity. Mandate that all users have passwords that are:
- At least eight characters long
- Never reused
- Contain lower- and upper-case letters, symbols, and numbers
- Void of common words or personal information, such as birthdays
Use Mitto’s multi-layered security system
Mitto’s multi-layered verification security approach has customers verify their identities in numerous ways, ensuring financial institutions know they are exactly who they say they are. Our verification solutions not only protect users but also safeguard your business by authenticating transactions and preventing fake bot accounts.
Mitto can manage the entire process or give you the tools to do it yourself. We offer numerous types of one-time password (OTP) codes that you can generate and verify yourself, including:
- SMS API
- Voice API
- Mobile and landline number verification
- Custom generated passcodes
- Custom passcode lengths
- Custom message templates
Or, leverage Mitto’s 2FA API solutions. We’ll generate codes, send them to customers, and verify them.