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Despite the growing threat landscape in the mobile app industry, many financial services apps are still underprepared. In fact, our research found that less than 50% of more than 3,000 financial apps on the Android marketplace have adequate mobile application security.
In this post, we’ll discuss the growing use of financial services apps and why mobile app security is so crucial. We’ll also cover ways financial institutions can better implement mobile app security to build and maintain trust with consumers.
As mobile app usage continues to grow across nearly every vertical, mobile is becoming the main interaction point for financial institutions. In fact, recent research suggests that 85% of Americans say they’ll use digital tools for some or all of their financial transactions after the pandemic with the download of finance apps spiking by 15% globally. That’s why many financial institutions are rapidly delivering additional features and mobile use cases to their customers.
While building a finance app faster than competitors may be critical for ensuring customer adoption, it’s not enough to maintain consumers in the long term. In fact, an innovative user experience may inspire banking app adoption, but it is trust that will retain customers. As we’ve found with digital vaccine passports, trust is crucial for adoption, especially for mobile apps that handle sensitive data.
While time-to-market and innovative, intuitive user experiences are essential, security is even more important for financial institutions. Because it’s now easier than ever for customers to open new bank accounts or move their money somewhere else, financial institutions can’t afford to have a negative reputation when it comes to security and consumer privacy.
If consumers don’t trust an app to safely handle their data and financial transactions, they won’t use it. Moreover, they won’t stick with a finance app that suffers from a poor reputation. Once an incident happens, there’s a good chance customers will not return and, through word of mouth, more customers could follow suit. Brand reputation and lack of customer confidence also make it much harder to attract new customers to replace the ones that have left.
Maintaining consumer trust requires an ongoing security effort and best-in-class security tools to avoid reputational damage. Strong security, therefore, is no longer a “nice to have” but a necessity for the success of a mobile finance app.
Since security is essential to the success of finance apps, here are some best practices for effectively implementing mobile app security.
Without adequate security measures in place, a mobile finance app is an easy target. Malicious actors are constantly scanning for low-hanging fruit they can take advantage of, and as our research illustrated, many finance apps are ripe for the picking.
Besides preventing security incidents from the start, it’s also easier and cheaper to implement security by design rather than retrofitting security measures after app release. Without proper security protocols in place, it leaves the mobile finance app open to increased risk of a security incident, which could cause customers to lose trust and switch to a competitor, even if the security issue is quickly mitigated. When developers use security tools that seamlessly integrate with their existing development workflow, they can achieve speed and security at the same time.
There are numerous rules and regulations organizations must adhere to in the finance industry, and for good reason. Financial incentives are one of the primary motivators for malicious actors; clearly, finance apps make an enticing target.
But complying with industry regulations isn’t just a necessity for operating the business within parameters of the law. Strong compliance efforts also signal to consumers that the financial institution is serious about security and privacy. For example, PCI compliance for secure payments and additional security recognitions like EMVCo certification are great ways to build trust with consumers. As contactless payments continue to grow in popularity, PCI CPoC compliance is another requirement many financial institutions will need adequate security measures to meet.
The goal of attacks on financial apps is typically to steal sensitive personal information or money, but the methods and techniques used are constantly changing. Since the sophistication of attacks continues to increase, financial institutions need to iteratively improve their mobile app hardening techniques to stay ahead of malicious actors.
Perhaps one of the greatest challenges is that many financial institutions attempt to implement mobile app security measures themselves. This do-it-yourself approach may offer a one-time solution, but it often fails to keep up with the evolving threat landscape. After all, financial institutions only have so many resources to allocate to both application security and building new features for users.
Purpose-built security tools provide financial institutions with a competitive advantage. The mobile finance apps that implement proven mobile app security measures that evolve with the latest threats can help financial institutions achieve the level of sophistication necessary to keep their apps and customers safe.
Guardsquare’s suite of security solutions focuses on a developer-friendly approach so financial institutions don’t have to make a tradeoff between time-to-market and security.