War of the machines: The future of fintech?

money coming out of a laptop

The bots are about to go to war and at stake is the future of fintech…

According to Jason Hoffmann, VP of cloud infrastructure at Ericsson, the future of fintech security will be a war of the machines. On the one side will be the big bat bots of the cyber criminals and on the other, the goodie bots of the financial institutions. In the middle will be us waiting anxiously to see who wins.

‘Some of the people who are becoming most advanced when it comes to artificial intelligence in the security world are the ones on the offensive,’ he explains. ‘one of the only ways to combat these guys will be to escalate defences to be built around artificial intelligence.’

The rise of fintech has taken the world by storm. Innovative start-ups are offering new ways to handle money which circumvent traditional financial institutions. The big banks initially looked on in horror before deciding that if you can’t beat them, they could always join them, and most are now well into their own fintech enterprises.

So, the future is fintech… or is it?

For all the exciting benefits technology brings us it also creates an entire world of new challenges. Back in the good old days, securing your system was relatively straightforward. You would buy the equipment, attach it to a warehouse somewhere and you’d be ready to go. It was physically at your location and its security was under your control.

The cloud has changed everything. Infrastructure is hosted remotely which means you’re dependent to an extent on the security protocols of your provider. It has greatly expanded the access to your systems as well as the amount of information coming into your organisation. Every update represents a new potential threat to the security of the entire system.

With more and more data coming from multiple sources, maintaining integrity becomes too big a task for any human operator. This is where the bots come in. Systems will need to monitor a vast array of different parameters and maintain settings.

AI is already playing an important role in identifying a leak and alerting an operator. However, in the future, it will take a leading role. On both sides of the legal divide.

Arms race

While financial institutions are slowly waking up to the power of AI, cyber criminals are already well along the way. They have been one of the leading users of AI and are developing complicated AI algorithms to constantly probe defence perimeters searching for their opportunity. As they refine their approach it becomes more and more difficult to maintain the integrity of the system.

Put simply, the manpower doesn’t exist to ensure safety against the black hat bots of the cyber criminals, which is why machines hold the key. They will have to run diagnostics, monitoring the system for vulnerabilities and breaches, and then responding to them. Particulalry because us humans also represent an obvious opportunity to the cyber criminals. When our provider asks to download an update, we assume it has been put through adequate security measures. A machine, on the other hand, does not make assumptions and so it never lets its guard down.

AI is in the early stages of evolution but it is evolving rapidly. As the cyber criminals turn to AI for attack, security professionals will have to also turn to AI for defence. It’s an arms race on which fintech’s entire future will stand or fall.