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Digital payment start-ups unaware of high security risks: FireEye

While there is a spurt in mobile wallet companies after demonetization, digital payments does pose a threat from security risks, FireEye.

  • Published: December 18, 2016 2:40 PM IST
mobile-wallet-stock-image

As India embraces a cashless economy, there has been a sudden spurt in new mobile wallet companies — but most of these start-ups are setting up digital shops without knowing the cyber risks involved, a top executive from US-based cyber security firm FireEye has emphasized. This is a dangerous trend when the country still lacks proper infrastructure and legislation to fight against cyber criminals. Also Read - Best online gaming platforms to play multiple games: Paytm First Games, PlayerzPot and more

Also Read - Internet down: Zomato, Paytm, Disney+ Hotstar, Amazon, Myntra, many other global services suffered massive outage

“While India is rapidly embracing a cashless consumer economy, payment technologies are growing in adoption faster than awareness of the risks involved,” Vishak Raman, Senior Regional Director for India and SAARC, told IANS. “Many of these are running as startups without sufficient attention to security. The rapid shift to digital transactions will greatly increase our collective exposure to cyber security threats — essentially fraud and theft,” Raman added. Also Read - Zomato IPO: How to invest via bank, Zerodha, and Paytm Money

In a first, the Central Bureau of Investigation (CBI) on Friday registered a complaint against 15 people for allegedly claiming fraudulent refunds worth Rs 6.15 lakh from the leading payment gateway Paytm. A Paytm spokesperson, however, said in a statement that the platform has robust risk management practices but the case has brought the risks to the fore. ALSO READ: After MobiKwik, Paytm partners with NHAI for digital payments at toll plazas

According to Raman, in the absence of data breach notification laws and the mandate to publicly disclose attacks, Indian enterprises often do not know how vulnerable they are. “This creates a false sense of security among CISOs/CIOs that their traditional defenses are working fine and that they are immune from advanced attacks organizations elsewhere are facing,” Raman noted. ALSO READ: Paytm processed sales of over Rs 220 crore at retail partner outlets

Paytm registered over seven million transactions worth Rs 1.2 billion in a day after the demonetization drive began on November 8. Another mobile wallet major, MobiKwik, which launched MobiKwik ‘Lite’ late last month, registered over two million downloads within the first two days of the ‘Lite’ offer. Global payment solutions provider PayU has also observed a hike in average daily transactions from Rs 1.2 million to Rs 2.5 million post-demonetization. ALSO READ: Paytm now lets users password-protect the app; here s how it works

This is how hackers can attack your money in e-wallets: Create multiple fake accounts to collect money in small amounts; cheat people who are digital novices by psychological manipulation; and breach servers and steal data. Even though most Indian organizations lack effective defenses against ransomware, as threats become more pervasive and frequent in India, organizations are slowly becoming aware about the need for advanced protection. ALSO READ: Digital payment providers at great hacking risk, need upgraded security: Experts

“However, it takes a combination of technology, intelligence and expertise to effectively prevent, detect and respond to attacks,” Raman told IANS. When asked where India stands when it comes to vulnerability in 2017, Raman said firms in Asia and particularly in India often struggle to discover that they have been breached. ALSO READ: Demonetization to increase hiring at e-wallet companies like Paytm, MobiKiwik, Freecharge

For example, “the median time between compromise and the discovery of an attack was 520 days in Asia Pacific, compared with 146 days globally. That is a massive difference,” Raman contended. In 2016, India faced a wave of cyber security incidents, ranging from targeted attacks on government organizations to ATM malware attacks. ALSO READ: Demonetization to help m-commerce growth in India: Report

“When coupled with its ill-preparedness to combat potential risks associated with cashless transactions and pushing hundreds of millions of citizens’ private information into the digital space, India stands quite vulnerable,” the FireEye executive cautioned. The sophisticated, financially-motivated espionage actor groups focusing on critical systems and maturing businesses will be prevalent in 2017 as these enterprises are often vulnerable to compromise.

Written by – Sourabh Kulesh (IANS)

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  • Published Date: December 18, 2016 2:40 PM IST



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