4 Misconceptions About Cloud Security in the Financial Industry
More and more banks and credit unions are either thinking about or already entrusting their IT solutions and data to cloud-based systems. While the allure of having applications and systems hosted on a cloud network is appealing to community banks and credit unions due to the ability to eliminate servers, internal infrastructure, and applications that would typically have to be hosted inside the institution, there are still some concerns with the transition, especially as it relates to security. Many organizations have some misconceptions and struggle with truly understanding the security differences of housing their sensitive data in the cloud vs. keeping it housed on servers and hardware solutions that are located on-premise.
Having sensitive data stored in a virtual environment is certainly different from on-premise resources, so it makes sense that security-related issues and concerns would need to be addressed and considered. It is understandable that you might have some doubts on whether you can really put your trust in something you can’t physically see and control in your own building or financial institution.
So, let’s take a look at some of the common issues and misconceptions about cloud security.
Misconception #1 – The cloud is not secure!
Cloud-based solution providers don’t take security lightly. In fact, the global cloud security market is predicted to reach $12.64 billion by 2024—up from $1.41 billion in 2016, according to Hexa Research. According to the report, the growth is driven by the increasing use of cloud services for data storage, and the rising sophistication of cyber attacks.
Misconception #2 – Once I move my data to the cloud, its security is not my responsibility
One of the main security-related issues when it comes to the cloud is determining who is actually responsible for data security. Cloud security is typically expected to be a shared responsibility. Just because a bank or credit union utilizes cloud-based solutions doesn’t mean they aren’t responsible for monitoring the security of the solutions, ensuring the data is safe and meeting compliance and regulation requirements. IT professionals and cloud vendors should share cloud security duties.
Misconception #3 – My data can be lost in the cloud
Cloud-based solutions excel in one critical security area and that is information resiliency. Utilizing the cloud will prevent the loss of data while also reducing the likelihood that it will be susceptible to corruption. Cloud-based solutions can recover quickly and continue operating even when there has been an equipment failure, power outage, natural disaster or other disruption, providing a bank or credit union continuous access to data and vital information.
Misconception #4 – Anyone can access my data
The cloud actually reduces the surface area of possible penetration attacks because the entry points into the cloud are very well defined and are locked down with multi-factor authentication and other mature and trusted security tools and processes. While physical security is no longer a worry, banks and credit unions will still need to manage user work stations, connections to applications, and switches and routers, to name a few. In addition, cloud-based solutions provide users with detailed reports of all activity– who has logged in, who accesses certain information, etc., which provides the ability to audit unusual or potentially harmful actions on the network.
Cloud services offer many benefits for financial institutions, including system standardization, centralization of information, the simplification of IT management and the built-in ability to stay current with technology and hardware updates. Deploying these tools in an on-premise environment and ensuring the entire network is secure enough to combat the growing cyber threats seen today would require not only large investments in infrastructure, but large teams to manage them as well. This can be extremely costly for small to mid-sized banks and credit unions. Ultimately, moving assets to the cloud enables banks and credit union’s IT executives to focus on the key capabilities that support the institution’s unique strategy while having the confidence all assets are secure.