Banks most affected by cybersecurity incidents: Economic Survey

Economic Survey 2024-25 highlights cybersecurity threats in Indian financial sector, emphasizing need for robust cyber resilience measures.

The Economic Survey 2024-25 said banks were the most affected by cybersecurity incidents with reports indicating that almost one-fifth of all reported cyber incidents involve financial institutions. It said the Indian financial sector amid digital transformation was also exposed to increased and diverse cyber threats.

It said the digital revolution had concurrently introduced new challenges and threats, including the illicit use of cyberspace for criminal activities.

Economic Survey 2024-25 Highlights

“These threats, ranging from phishing and ransomware to Distributed Denial of Service (DDoS) attacks, SMSing, and fake/malicious mobile applications, pose serious challenges to the financial system’s stability,” the report said.

The Survey stated that as per the information reported to and tracked by the Indian Computer Emergency Response Team (CERT-In), the number of observed and handled cybersecurity incidents stood at 11.6 lakh, 14 lakh and 13.9 lakh respectively during 2020, 2021 and 2022.

“The financial sector remains susceptible to cyber threats because it manages sensitive data and conducts critical transactions. Criminals often target financial institutions to either gain unauthorised access to assets or disrupt financial activities, jeopardising economic stability. Reports indicate that almost one-fifth of all reported cyber incidents involve financial institutions, with banks being the most affected,” the report said.

According to International Monetary Fund’s April 2024 Global Financial Stability Report, cyberattacks have resulted in extreme financial losses, which have increased fourfold since 2017, amounting to $2.5 billion. Beyond these direct losses, indirect costs such as reputational damage and expenditures on enhanced security have also significantly risen, the report said.