Online banking is now nearly universal. Long lines at the credit union, late-night ATM trips, and waiting for checks to clear have largely become a thing of the past. Digital banking has revolutionized the financial industry and the way we do business as a whole.
However, it has also indelibly increased the risk of cyberattacks, social engineering scams, and online compromise to the financial community.
Here are some of the top risks facing the industry today, along with current best practices for keeping financial transactions secure.
Top Threats Facing Financial Institutions
The Verizon 2025 DBIR notes that 90% of attacks are financially motivated. While it's true that all organizations have money to steal, that doesn’t keep banks, credit unions and other financial institutions from being a particularly tantalizing and lucrative target.
Financial institutions are primarily impacted by a small number of recurring attack patterns, rather than isolated threat types. These patterns reflect how attackers actually achieve breaches in real-world environments:
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Social Engineering & BEC – Phishing, pretexting, and Business Email Compromise (BEC) continue to drive major financial losses by manipulating employees into authorizing fraudulent transactions or disclosing credentials. Tactics like MFA prompt bombing and impersonation remain highly effective in email‑centric financial workflows.
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Basic Web Application Attacks – Opportunistic attacks against public‑facing applications focus on speed and simplicity, often using stolen credentials or brute‑force methods to quickly access and exfiltrate data. These attacks increasingly attract more sophisticated actors, including those motivated by espionage.
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Miscellaneous Errors – Unintentional mistakes such as misdelivery, misconfiguration, or accidental data publishing continue to expose sensitive customer information. While not malicious, these errors still result in regulatory risk, reputational damage, and potential identity theft.
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Privilege Misuse – Improper use of legitimate access—by insiders or trusted partners—remains a persistent risk. Financially motivated misuse dominates this pattern, while extended access granted to third parties increases the potential impact of poor access controls or oversight.
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Denial of Service (DoS) – DoS attacks targeting availability continue to grow in scale and frequency, with financial institutions remaining the most targeted industry. Even short‑term outages can disrupt operations, customer access, and transaction processing.
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Lost and Stolen Assets – Incidents involving misplaced or stolen devices continue to decline due to stronger controls like encryption and remote wipe, but the risk persists when assets leave physical custody—particularly when sensitive or regulated data is involved.
Unique Challenges of Online-Only Banks
Given the hybrid models in use by banking institutions these days, all banks are facing similar issues as they scramble to offer app-based banking and digital service models. However, this convenience comes with a price.
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Online‑only banks are often perceived as less secure. Even though reputable institutions are insured in the same way as traditional brick‑and‑mortar banks, distrust tends to persist when a bank lacks a physical, Main Street presence. This concern was reinforced by the collapse of Silicon Valley Bank, once a highly trusted financial partner for tech startups and venture‑capital firms.
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A larger technology stack inevitably creates a larger attack surface. As banks expand their digital services and rely more heavily on APIs, cloud infrastructure, and interconnected platforms, their exposure to cyberattacks increases accordingly. The financial sector has seen a sharp rise in both the scale and sophistication of DDoS attacks, with application‑layer attacks against banks increasing and increasingly designed to mimic legitimate traffic, making detection more difficult. These attacks can overwhelm systems, degrade performance, and cause multi‑day service disruptions, whether driven by malicious activity or sudden traffic surges. As a result, institutions face losses not only from potential ransom demands but also from downtime, latency, and erosion of customer trust.
How Financial Institutions Can Protect Themselves
While financial institutions might be tempted to place the bulk of their focus on next-generation security models that combat advanced security threats, solid security protocols in basic places could go miles in preventing financial service cyberthreats.
As financial service firms are left to take matters into their own hands, a solid offensive security strategy can help close the gaps and secure business.
Follow Compliance Requirements
Proactive security can also aid adherence to compliance regulations like SOX, PCI DSS, GDPR, and more.
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For example, SOX compliance requires an annual audit to ensure sensitive financial data is properly secured. Proactive techniques like penetration testing and red teaming, performed throughout the year, can help organizations comply with the SOX policies of tracking and resolving attempted data breaches and securing data against possible tampering.
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They can also aid PCI DSS compliance by testing the efficacy of the primary requirements, and actively enabling one in particular; number eleven, to regularly test security systems and processes.
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Any financial firm doing business internationally in Europe must comply with GDPR, and proactive security measures like penetration testing help to ensure that all necessary security controls are in place to secure GDPR-protected data. They also provide additional in-depth insights into customer and organizational data and offer continuous auditing of incoming technologies, systems, and applications for GDPR compliance.
Implement Effective Offensive Security Measures
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Vulnerability Management | Vulnerability management lays the foundation for the rest of your offensive security program, helping you assess risks and prioritize vulnerabilities with intelligent scanning from Fortra VM.
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Penetration Testing | With Core Impact, security teams of varying experience levels can conduct advanced penetration tests. Guided automation and certified exploits ensure your systems are being tested with the same tactics used by attackers today. Need an outsider's perspective? Fortra’s penetration testing services can assess your environment, testing your access controls and exploiting vulnerabilities to give you a clear path to remediation.
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Red Teaming | Fortra’s Cobalt Strike, a powerful threat emulation tool, enables red teamers to mimics the actions of a long-embedded threat actor and puts defenses to the test with a dynamic post-exploitation agent and adaptable C2 framework. Additional red team effectiveness can be provided with Outflank Security Tooling (OST), a red teaming toolset that focuses on stealth and evasion for every step of the attack kill chain.
Online banking is a feature of the modern era, and unfortunately, so are persistent cyberattacks. Financial institutions don’t want to face these ongoing threats unprepared. Fortunately, with a proactive security strategy, they won’t need to.
Learn more about proactive security strategies
Find out how to effectively manage your financial institution's attack surface in our guide, The Complete Guide to Layering Offensive Security.
