Best Security Measures to Safeguard Your Fintech APIs

Fintech is the best innovation that the Finance Industry has undergone. It has completely changed the way we manage our finances.

API is the backbone of this innovation. It connects modern Fintech applications with different software components. This integration allows efficient data exchange between financial systems, enabling seamless communication. You already know that information worth billions of dollars is exchanged on these fintech platforms. This is precisely why hackers love Fintech APIs! According to expert projections, cyberattacks can cost businesses up to $10.5 Trillion by 2025.

You wouldn’t like your business to contribute to that, right?

So, what security measure are you planning? How will you secure your fintech platform APIs? Here are five advanced security measures that you can use. But first, let’s understand the entire API threat landscape.

Understanding The API Threat Landscape

The fintech market is projected to reach USD 917.17 billion by 2032. This growth indirectly reflects the rising volume of sensitive data that fintech APIs will process.

First, you must understand the probability of threats and strategically plan security measures to overcome them. Here are the top threats that your fintech platform may face.

1. Unauthorized access: This tops the list as it is the most commonly used method among hackers to access sensitive information, such as customer data, financial records, or proprietary business data. Attackers may exploit API authentication or authorization systems loopholes to replicate legitimate users.

2. Man-in-the-Middle (MITM) Attacks: Cyber attackers intercept communications between two systems in MITM. This allows attackers to read, modify, or steal sensitive information or perform unauthorized actions on behalf of the user.

3. Brute Force Attacks: In Brute Force attacks, automated tools guess passwords, API keys, or other credentials. Attackers try different combinations and permutations until a successful match is found. These tools attempt thousands of combinations in a second, making it difficult for traditional security measures to keep pace. So, weak passwords are the first to be cracked within minutes or even seconds. ?If the Fintech API lacks proper rate limiting or IP restrictions, the attacker can make unlimited attempts to guess a password, increasing the likelihood of success.

4. Cross-Site Request Forgery (CSRF): Attackers often use social engineering tactics, manipulating people into giving away sensitive information or performing actions that compromise their security. CSRF is one such tactic where an attacker tricks an authenticated user into clicking on a malicious link or submitting a forged request to the API. An email with a seemingly harmless link can be attacked, urging the user to "click here" for more information or to claim a prize. That link triggers a CSRF attack. Suppose the API doesn’t properly validate the request's origin or include CSRF tokens. In that case, it can lead to unauthorized actions on the user's behalf, such as transferring funds or changing account settings.

5. Distributed Denial of Services (DDoS): In DDoS, the attackers flood the app with huge traffic to crash the entire system. First, the attackers infect various devices by deploying malware and turning them into ‘Bots.’ Then, a network of all these ‘Bot’ devices is established, known as a ‘BotNET’. The attackers then use these bots to send numerous requests or data packets that exceed the server's capacity to handle incoming traffic. The result is that legitimate users won’t be able to access the service, leading to downtime, loss of revenue, and potential damage to reputation. APIs that don’t get rate restrictions are prone to such attacks.

Understanding these common threats is crucial for fintech organizations to develop effective strategies for securing their APIs and protecting sensitive data. API security risks can be of several other types and must be addressed.

Always remember that sensitive information is not the only thing that will be compromised in an attack. Your platform's reputation will also be compromised. So, you need to make strategies accordingly.

5 Best Ways To Protect Your FinTech Platform Against API Attacks

Here’s a guide for all to know the best practices of API security.

1. Implement Strong Authentication and Authorization

First, the most essential thing is to ensure access to your services only to authorized users. According to standard industry practice, use oAuth 2.0, which will allow you to manage permissions and access rights so third-party applications can access user data without exposing the credentials.

Multi-factor authentication (MFA) is also a common practice. To gain access to the system, users must provide multiple verification forms, such as a password, PIN, and biometric authentication. This makes it hard for attackers to impersonate an actual user.

2. Data Encryption

Encryption of data is more like putting your sensitive information in a secured locker that can only be accessed by authorized users.

It can be explained in two ways.

Encryption in Transit: The data exchange between users and servers is protected using protocols like Transport Layer Security (TLS). This ensures that even if someone intercepts the data while it's being transmitted, they won't be able to read it.

Encryption at Rest: This secures data stored on servers or databases. By encrypting sensitive information like credit card numbers or personal identification details, even if hackers gain access to the database, they will only see useless scrambled data without the decryption key.

Encryption secures your API and helps you comply with regulatory requirements such as GDPR and PCI DSS.

3. Rate Limiting and Throttling

You can implement API rate limiting to counter brute force and DDoS attacks. This limits the requests a user can make in a specific timeframe. Not only does this prevent servers from being overloaded, but it also guarantees equal resource allocation across the application.?

Another technique that can be implemented is Throttling. It temporarily blocks users who exceed a pre-defined limit, allowing you to maintain service availability. These measures help ensure that only legitimate users can access your services.

4. Implement Server-Side Data Validation

Fintech APIs are also prone to injection attacks, in which attackers try to insert malicious code or query into the system and modify or steal crucial financial data.?

You can prevent that by using Input Validation, where you create a set of rules to allow only certain types of input to be accepted by the systems. Here are a few common rules to implement:

• Whitelisting: Allows only specific characters to be entered as input.
• Blacklisting:? Disapprove a few particular characters from being entered as input.
• Format: Permit only inputs that follow a specific format, such as email addresses.
• Length: Limit the length of inputs to the number of characters in a specific.

Still, if the attackers have corrupted data, you can remove it before processing. To do so, you can use Data Sanitization, which protects the data from SQL injections and other forms of attack. In short, server-side validation ensures malicious payloads cannot compromise APIs.

5. Use API Gateways and Firewalls

API gateways are the middle layer between the API server and the user. They manage access control, traffic routing, and rate limiting. Some common examples of API gateways include Google's Apigee, Salesforce's MuleSoft, AWS API Gateway, and Microsoft.

You also need to secure communication between the Internet and the API Server. Here, you can use API Firewalls to analyze incoming traffic and block malicious traffic. The blocking and allowing process is based on IP address, port, and Protocol criteria.

A firewall can be used as the first line of defense, while an API gateway can be used as the second line of defense to secure the API’s in the best possible way.

Conclusion

To sum up, securing your fintech platform’s APIs must remain a top priority. These robust security measures will safeguard your business against evolving cyber threats and create a sense of trust and reliability among the users. That’s a perfect way to retain existing users and gain new ones.

Many of you may need help understanding the intricacies of fintech cybersecurity. In such cases, you can partner with an expert fintech app development company that is well-versed in security measures, easing the complexities of development.?

Invest in a secure future today!