Cybercrime is on the rise. All companies in all industries are at risk. But financial services firms have suffered the most. They were successfully attacked—yes, that means actually breached—65% more than the average organization in 2016. The number of financial services records stolen ballooned 937% to more than 200 million. And 2018 looks like it will be more of the same.
Because of this, financial institutions are turning to outside experts—third parties that offer managed security services (MSS)—to help them reduce risk.
A recent study predicts that the MSS market will reach $40.97 billion by 2022, which amounts to a compound annual growth rate (CAGR) of 16.6% from 2016, making it among the fastest growing market segments in the security industry.
According to an Ernst & Young study, significant numbers of global enterprises are already outsourcing some aspect of their cybersecurity operations. More than half (52%) have outsourced vulnerability assessments; 41% outsource security monitoring; 33% outsource their security management systems; and 21% outsource their IT security help desks and employee phishing training.
Why Should Financial Companies Use a Managed Security Service?
Here are a number of reasons why a financial services firm would pay a MSS provider to take over its cybersecurity functions:
According to the CERT Coordination Center of Carnegie Mellon University, the cost of a managed security service is typically less than hiring a team of in-house, full-time security experts. For example, one full-time security specialist will cost $75,000—if you can find one—without counting tax, administrative and benefits costs. Then there are the costs of hiring and training. And, depending on the size of your organization, you may need more than just one.
The sophistication of cyberattacks is evolving at a rapid pace. One new threat leads to another. Keeping up with evolving threats, addressing threats as they arise and recovering from incidents detected too late can take up a considerable amount of a company’s time and resources.
To properly fight today’s cybercriminals, a highly sophisticated security operations center (SOC) is recommended. Creating and managing a SOC is usually too costly for most financial services companies. You would have three main expenses: capital costs (building and equipping the physical space); your annual payroll costs (for a 24/7/365 SOC with 10 analysts, that adds up fast); and annual recurring costs (software licenses and fees, training, and general IT costs). An MSS gives you access to this valuable resource without having to build and maintain it yourself.
Cybercriminals can decide to attack at any given time, but most financial services firms can’t afford to be vigilant at all times. When a financial services firm hires an MSS, it gets around-the-clock protection—24 hours a day, seven days a week, 365 days a year. This coverage largely contrasts in-house services that only operate during normal business hours.
Freedom to Focus on Business Priorities
Financial services firms need to focus on their core business priorities. The more budget and person power—and attention—they devote to security, the less resources they have to be great at what they do. A managed security services partner minimizes this burden, enabling financial services firms to focus on running their businesses.
Most MSS providers specialize in early threat detection, minimizing the need for costly repair and remediation efforts. They keep their fingers on the pulse of the threat landscape, reducing their risk of losing money, customers, and reputation.