How does each open banking platform help prevent data theft or leaks?
When you talk about becoming more open in the digital sense, especially when the matter concerns money, there’s always going to be concerns about data security and leaks. However, for open banking in the realms of the United Kingdom and the European Union, there are numerous safety measures and technical requirements to meet, in order to ensure data security. Let’s shine a light on how almost every open banking platform is able to prevent data theft or leaks.
Access to information is only granted to select providers
As we all know, big banks spend a lot of money on cybersecurity. They have to. But, the most common way to lose personal data online is by not becoming a victim of a mass data leak but by mistakenly entering it on a scam or untrustworthy 3rd party site.
Open banking sites are trustworthy and rarely handle your personal information. However, if they do, they can only access data and facts to which you consent to. It’s only related to your financials and nothing else. Besides, the data exchange happens in an enclosed and encrypted connection without the intervention of third parties. There are governing bodies that monitor how these technical solutions are implemented and licenses are given to those developers which can ensure security.
SCA
The core security measure which prevents a lot of data misuse and leaks is the SCA (Strong Customer Authentication). It’s a unique type of multi-factor authentication which is exclusive to open banking only. In order to proceed with any open banking operation at all, a customer needs to authenticate themselves and the operation in two out of the three available methods.
The three factors/methods are biometric data, passwords, and pin codes as well as authorized devices. Even when a single factor is compromised, it doesn’t necessarily mean the compromise of other factors, making SCA very secure and safe for open banking.
Continuous updates
It’s hard to prevent cyber-attacks if your programming foundation becomes outdated. Developers are focused on implementing state-of-the-art solutions and they require state-of-the-art security. It’s in their best interest to keep your data safe and thus, data leaks and data theft are almost unheard of.
Delegated responsibilities
Third parties never gain access to your log-in information in the bank, pin codes, CVC numbers on credit cards, etc. This is because third parties redirect you to an authorized bank log-in screen where the information is handled by the bank and not the third party. Once the operation is authorized, data that was requested, is transferred to the 3rd party but other information remains sealed away and private. Clear delegation of responsibilities and a very consistent architecture allow for secure and strong protection of your data.
Involvement from the big banks
Since the data that’s at risk is your financials, which are held by the big banks, it’s in their best interest to do everything in order to prevent leaks and attacks. They collaborate with developers, integrate sandboxes, and offer technical advice to their partners. All of this is done in order to improve current technology and to protect their customers from the risk of leaks and data theft.