The Cost of Convenience: The Top Mobile App Security Risks in Banking

In today’s fast-paced world, mobile banking has become the preferred mode of banking for many people. With the convenience of being able to access your account from anywhere at any time, it’s no surprise that mobile banking has become so popular. However, this convenience comes with a price – the risk of mobile app security threats.

Mobile banking apps have become a prime target for cybercriminals, who are constantly looking for ways to exploit vulnerabilities in these apps. The consequences of a security breach in a mobile banking app can be devastating – not just for the individual user, but also for the bank itself. In this blog, we will explore the most common security risks associated with mobile banking apps, and what steps can be taken to mitigate these risks. But before we get to that, let’s try to understand what makes banking apps so vulnerable. 

Why are Banking Apps Vulnerable?

Mobile banking apps have become a popular target for cybercriminals for obvious reasons. These apps often contain sensitive information, such as account numbers, and personal identification information, which can be used to steal money or commit identity theft. In addition, banking apps are used by millions of people around the world, making them a prime target for cyberattacks. Mobile banking apps are convenient and easy to use, but they also pose significant security risks for users and financial institutions alike.

There are several risks associated with security flaws in banking apps. These flaws can allow attackers to gain unauthorized access to user accounts, steal sensitive data, and even transfer funds. Attackers may use phishing attacks or other social engineering techniques to trick users into revealing sensitive information or have malware installed on users’ devices.

Additionally, security flaws in banking apps can also lead to reputational damage for financial institutions. A data breach or other security incident can erode customer trust and damage the institution’s brand.

These risks arise from a variety of factors mentioned below.

Complexity

Modern banking apps are incredibly complex, with numerous features and functions designed to make banking more convenient for users. However, this complexity also makes the apps more difficult to secure, as each new feature or function can introduce new security weaknesses.

Third-party Code

Many mobile banking apps rely on third-party code libraries and frameworks to provide functionality such as payment processing, data storage, and user authentication. While these libraries and frameworks can be convenient, they can also introduce security risks if they are not properly vetted for vulnerabilities.

User behavior

Users themselves can also contribute to the vulnerability of banking apps. For example, users may choose weak passwords, reuse passwords across multiple accounts, or fail to install security updates in a timely manner.

Overall, these factors commonly make banking apps a high-value target for attackers. As such, it is critical for financial institutions to take steps to secure their mobile apps and protect their users’ data and assets. Now that we’ve understood why banking apps are so vulnerable, let’s understand what types of vulnerabilities mobile apps face threats from.  

Common Banking App Vulnerabilities

Attackers are always on the lookout for vulnerabilities in these apps that they can exploit to gain unauthorized access to users’ accounts. While many banking apps employ security measures to protect user data, here are some common vulnerabilities that can compromise mobile banking security.

Insecure Data Storage

Mobile banking apps can store sensitive information, such as user credentials and transaction details, on the device itself. If this information is not encrypted or stored securely, it can be easily accessed by attackers.

Man-in-the-Middle

Man-in-the-middle (MITM) attacks occur when an attacker intercepts the communication between the user’s device and the banking app’s server. This allows the attacker to view and modify the information being transmitted, including login credentials and financial information.

Several banking apps have been vulnerable to MITM attacks from time to time. Researchers of the Security and Privacy Group at the University of Birmingham tested hundreds of different banking apps—both iOS and Android—and found that several of them were affected by a common issue, leaving their users vulnerable to man-in-the-middle attacks.

Poor Authentication

Weak or non-existent authentication measures, such as simple passwords or no two-factor authentication, can allow attackers to easily gain access to user accounts. With advanced tools and high performance computers, bruteforcing passwords have become easy. Therefore, along with multi-factor authentication, proper lockout systems should also be implemented. 

Sharing Services

Mobile banking apps often share services with other apps on a user’s device, which can create potential security risks if those apps are vulnerable to attack. 

Weak Encryption Algorithms

Encryption is an essential security measure for protecting sensitive data. If the encryption algorithm used by a banking app is weak or incorrectly implemented, it can be easily bypassed by attackers.

Code Tampering

Attackers can tamper with the app’s code, by modifying or injecting malicious code, which can allow them to gain access to sensitive data or take control of the app.

Exploiting Vulnerabilities in the App

Attackers can also target vulnerabilities in the banking app itself, such as insecure coding practices or outdated software. One example of an attack that exploited a vulnerability in a banking app is the 2016 incident where hackers stole $81 million from the Bangladesh Central Bank by exploiting a weakness in the SWIFT payment system used by the bank.

These vulnerabilities can have a significant impact on mobile banking security, potentially resulting in financial losses and identity theft. Therefore, it is important for app developers to implement robust security measures.

How to Secure Your Mobile Banking App?

To ensure the safety and security of mobile banking apps, it is crucial to implement effective security measures. In this section, we will discuss some of the most effective security measures to protect against common banking app vulnerabilities.

Encryption

Encryption is one of the most effective security measures that can be used to protect sensitive data in mobile banking apps. By encrypting data, it becomes unreadable to anyone who does not have the decryption key. This makes it difficult for attackers to use encrypted sensitive data such as login credentials or financial information.

Multi-Factor Authentication (MFA)

Multi-factor authentication is a security measure that requires users to provide multiple forms of authentication before accessing their accounts. This adds an extra layer of security to mobile banking apps by requiring users to provide multiple information for authentication such as something they know (such as a password) and something they have (such as a fingerprint). Therefore, even if a user’s credentials are compromised, there’s another layer preventing attackers from accessing the account using the credentials.

Application Hardening

App hardening involves modifying an app’s code to make it more difficult to reverse engineer. This can include obfuscating code, encrypting data, and adding anti-tampering measures. By hardening the app, it becomes more difficult for attackers to access sensitive data or modify the app.

Regular Updates

Mobile banking apps should be updated regularly to ensure that any security vulnerabilities are addressed. Updates can include bug fixes and security patches. It is important for users to keep their apps up to date to ensure that they are protected against the latest threats. You might have noticed that some banks force users to update apps by not allowing them to use sensitive functions if the app is not updated. Although it might seem like causing a little inconvenience, users realize the importance of this and mostly do not resist it. 

It is important for C-Suite roles to understand the importance of implementing effective security measures in mobile banking apps. By doing so, they can protect their customer’s sensitive data and maintain their reputation. A data breach can be costly in terms of both financial losses and damage to the brand. You wouldn’t want either of this to happen to your organization, would you? Implementing effective security measures can prevent breaches from occurring, which ultimately saves the company time, money, and resources. The choice of tools and security products also plays an important role. Using a platform like GuardRails makes AppSec easier for both security and development teams as GuardRails can scan, detect, and provide real-time guidance to fix vulnerabilities. 

Conclusion

Mobile banking apps have revolutionized the way we manage our finances, but they come with a high cost of convenience. Mobile banking security is of utmost importance, given the increasing dependence of customers on mobile apps for banking transactions. The risks associated with mobile banking apps can lead to financial losses, reputational damage, and loss of trust in the banking industry. It is crucial for both individuals and organizations to understand the risks and take necessary steps to protect themselves against these threats. It is necessary for banks and financial institutions to implement robust security measures to protect their customers’ data and finances.

We discussed some common banking app vulnerabilities and ways to mitigate them. Regular security testing, employee training, and customer education are also essential to maintaining a strong mobile banking security posture. By implementing these measures, banks can significantly reduce the risks of cyberattacks and protect their customers’ assets and data, ensuring that the convenience of mobile banking does not come at the cost of security.

About the author:

Omkar is a cybersecurity team lead who is enthusiastic about Cybersecurity, Ethical hacking, and Python. He is keenly interested in bug bounty hunting, vulnerability analysis, and attack chain research. Omkar spends his time researching and building systems with an intent to make the world a secure place.

The post The Cost of Convenience: The Top Mobile App Security Risks in Banking appeared first on GuardRails.

*** This is a Security Bloggers Network syndicated blog from GuardRails authored by Omkar Hiremath. Read the original post at: https://blog.guardrails.io/the-cost-of-convenience-the-top-mobile-app-security-risks-in-banking/