Where there is money, there are cybercriminals. This is especially true for credit unions which deal with both financial information and the personal identifying information (PII) of every member and connected institution. They are a digital vault of gold coins and the hackers are all too ready to crack the safe.
While it seems like credit unions should be the most adapt at thwarting cyber attackers considering what’s behind their computer screens, they, like many other industries, find themselves struggling to stay safe in a changing threat landscape. In fact, financial services firms are 300 times more likely to be targeted by a cyber attack.
These institutions face unique challenges that other financial institutions, like large banks, do not. These challenges require a newer, holistic approach to cybersecurity.
Four Security Challenges Credit Unions Face
In addition to being obvious marks for attackers, credit unions face specific security challenges that make it easier for hackers to deploy and succeed with an attack.
1. Employing Outdated Technology
Because they are smaller, more local, and operate with a smaller staff, credit unions are often operating on outdated technology, including a lack of email security and out-of-date software systems. This means software with unpatched vulnerabilities, cybersecurity gaps, and gaps in mail security. According to a new report by Black Kite, 50% of credit unions have a critical vulnerability in their system. A hacker will exploit any gap they can find, and credit unions are full of them
2. A Strained Workforce
Like many organizations, the cybersecurity teams at credit unions are overworked. Financial service cybersecurity workloads grew more than any other industry in response to breach news. It’s known that the cybersecurity skills gap is only growing, and that will affect smaller organizations like credit unions differently than large corporations
3. Reporting and Responding to Incidents
Credit unions are subject to regulations and compliance requirements, which can be difficult to maintain and make responding to cyber incidents more complicated. Under a proposed NCUA rule, credit unions would have a maximum of 72 hours to report cyber incidents. Currently, that may be difficult to achieve given organizations lack technology or staffing
4. Managing cyber insurance requirements
Like every organization, credit unions are dealing with spiking cyber insurance rates and increased requirements. If an organization is struggling with tech and talent, achieving cyber insurance requirements becomes more difficult.
What’s at Stake If a Credit Union Is Breached?
The costs of a cyber breach extend far beyond a dollar amount. For credit unions the consequences of a cyber attack include:
- Data loss and data exfiltration
- Fraudulent spending
- Replacing debit cards and remediating member’s accounts
- Lost revenue that comes from downtime
- Reputation damage and lost members (67% of consumers notified of fraud changed their credit union or bank)
Those costs add up quickly, and for a small credit union, they can be devastating. While Cyber criminals are more interested in stealing credit card numbers and PII than ruining the reputation of a credit union, organizations need to understand how wide-ranging the consequences can be and use that as motivation to improve their cybersecurity.
How Credit Unions Can Prepare for Future Cyber Threats
Credit Unions need to tackle every angle of their cybersecurity gaps. Technology can’t solve the problem alone. From solutions to staff to compliance, a holistic approach is always the best to add both breadth and depth to one’s security posture.
At Arctic Wolf, we recommend taking a security operations approach, which allows organizations to improve their security posture without straining staffing and creates a security environment where threats can be quickly detected and responded to before they turn into major breaches.
We have a variety of resources to help credit unions evaluate their security maturity and start taking actionable steps to improve compliance, incident response, and proactive security solutions.
