4 Practices to Enhance Data Security in Your Financial Website

Data security has become one of the most critical concerns for today’s financial institutions. As of 2024, the average cost of a data breach in the financial industry worldwide was $6.08 million. Not only does this significantly strain your finances, but it also compromises your clients’ information and, by default, trust. You must ensure that data does not fall into the wrong hands. In this article, we will explore just how you can do that.

Why Is It Important for a Financial Institution to Secure Data?

Data security is integral in any industry. No consumer wants to see their information compromised. However, the pressure is significantly higher for financial institutions. Any financial institution, whether it’s a bank or a credit union, requires highly sensitive data from its clients. This ranges from names and addresses to social security numbers. Loss of this information can lead to identity theft, which can be devastating for the client.

Data security is also vital when it comes to consumer loyalty. Members will have peace of mind knowing their financial transactions are secure. More importantly, they will be comfortable knowing that their financial institution goes above and beyond to protect their data from unauthorized access. This will likely build trust, giving you clients who are loyal and prepared to stick with you through tough times. Here are four practices you must familiarize yourself with if you want to secure your clients’ data:

Implementing SSL/TLS Encryption

Secure Sockets Layer (SSL) and Transport Layer Security (TLS) encryption are critical for securing data. SSL/TLS encryption ensures secure communication between a financial website’s server and the user’s browser. That is, it encrypts the data exchanged by the two. This way, even if a third party accesses it, it cannot read or decipher it. While SSL is an older protocol that provides encryption to online transactions, TLS is a modern version that secures all communications across the web.

To implement the encryption, you must first acquire a valid SL/TLS certificate from an authentic Certificate Authority. Then, install it on your website’s server to redirect all traffic from unencrypted HTTP to encrypted HTTPS. You can set up a server-side 301 redirect to automatically conduct this. Lastly, all internal links and sources, including images and scripts, must be updated to use the HTTPS protocol. Remember to renew your certificate regularly every one to two years before it expires.

SSL/TLS encryption will ensure confidentiality. Only parties of your choice will be able to decrypt the data. This protects it from cybercriminals during transmission. It will also preserve the integrity of your data. Hackers cannot alter the information being exchanged. If there is an attempt to do so, the system will detect it and prevent the transaction from going through, ensuring safety.

Multi-Factor Authentication (MFA)

MFA entails two or more verification factors to protect data. The most common form of authentication is the password. Keep your password policies strong. Ask for passwords at least 12 characters long, including uppercase letters, numbers, and symbols. There are also OTPs, biometric verification, voice or face recognition, etc.

You should ideally enable MFA for all logins. If you’re concerned about clients finding it inconvenient, you must enable it for high-risk actions at the very least. These could include transferring funds, changing account settings, or accessing sensitive financial information. While doing so, try to ensure a seamless experience. Implement MFA in a way that does not disrupt processes, as that can frustrate users. To improve adoption, you can offer smoother processes, such as one-click approval for push notifications or seamless biometric authentication.

Consider providing your users with multiple options. Give them a choice between authenticator apps, SMS codes, or biometric verification to offer flexibility. They can then choose a method they’re most comfortable with, enhancing user experience. It’s better if you educate them about these, too. Set up tutorials, FAQs, and user-friendly guides. Your older users will especially appreciate them.

MFA is a layered security approach that will provide increased resistance against attacks. Even if one factor, for instance, the password, is stolen, the other factors will act as practical barriers, preventing access. Additionally, your users will feel more secure knowing that you are actively working to protect your data.

Secure Coding Practices

Secure coding practices will ensure compliance with regulations and protect user data. Here are some key coding practices you can use to achieve this:

• Input validation and sanitization: Do not trust user input. Instead, validate input on both the client’s and server’s side and sanitize it to remove any harmful characters. You can use prepared statements or parameterized queries to prevent SQL injection attacks when interacting with a database. For example, if a user enters an email address, ensure no special characters can execute a harmful action.
• Secure session management: Your users might have to stay on the website for extended periods. Use secure session tokens, such as session timeouts and two-factor authentication. For instance, you can use the HttpOnly flag for cookies to prevent access via JavaScript and set the secure flag to ensure cookies are only transmitted over HTTPS.
• Error handling: Exposing too much information in error messages can give attackers insights into vulnerabilities. Design general error messages that do not go into too much detail about database structures or server configurations. For example,  instead of displaying an error message like “Invalid username: [username] not found in the database,” display a generic message such as “Invalid username or password.”
• Cross-site request forgery (CSRF) prevention: CSRF attacks will trick a user into performing unwanted actions on a website. These could include transferring money, changing account details, etc. You can develop anti-CSRF tokens to counter this. These are unique, unpredictable values tied to each user. Incorporate these in forms to ensure any request is authentic. The request will be valid if the anti-CSRF token matches the token stored in the user’s session.

You must ensure your web developers adhere to secure coding practices to prevent malicious actors from accessing information, especially in areas like Texas, recording the second-highest financial losses for victims in the USA. It is your responsibility to keep your client’s data safe.

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Regular Security Audits

Data security is not a one-time task. You must take it on as a commitment and consistently aim to strengthen procedures. Conduct regular audits and vulnerability testing. Cyber threats are ever-evolving, so you must ensure your security continuously adapts to them. Have security professionals incorporate vulnerability scanners in your systems. These will have regular routines, detecting weaknesses in your code and software.

Additionally, carry out penetration testing. This essentially mimics real-life cyberattacks to test your website and identify potential vulnerabilities to assess your systems’ actions in case of actual attacks. This way, you can uncover security gaps and weaknesses, such as unpatched software, misconfigured servers, or exploitable flaws in the code. This measure will allow you to stay one step ahead of cybercriminals and improve consistently. You can comply with industry regulations that mandate regular assessments by carrying out these checks.

Data Security for a Financial Website – Endnote

Your data security must stay resilient against the ever-increasing threat of cyberattacks on financial institutions. Remember, your clients will only trust you if they trust your procedures and software. Incorporate the abovementioned practices in your safety measures and tell your clients that confidentiality is your priority!