The payment industry operates within one of the most interconnected—and vivisected—ecosystems in the financial sector. With billions of transactions flowing daily across global networks, it’s also a prime target for cybercriminals hoping to exploit a slew of different vulnerabilities.
Cybersecurity in payments plays a critical role in protecting this ecosystem, but the question remains: can firms truly offer a holistic cybersecurity approach to the payment landscape, or are their efforts still fragmented and reactive as we head into 2025?
The Imperative for a Holistic Approach
The payment ecosystem is astonishingly complex, made up of a network of interdependent players including payment processors, banks, card networks, merchants, and third-party vendors. This motley patchwork of different companies—with vastly differing cybersecurity capabilities—creates near-endless potential points of vulnerability. And with the rise of real-time payment services, mobile wallets, and advanced APIs, this web of connections is growing even more intricate, which unfortunately expands the attack surface for cybercriminals.
Open banking and integrated payment systems highlight just how critical third-party integrations are in today’s payment security landscape. Open banking security allows third-party providers to access bank data, while integrated payment systems depend on a wide network of external vendors to process secure transactions. Each of these interconnected services opens the door to more potential risks.
A recent article from Lloyd’s posits a nightmare scenario, where attackers insert malicious code into key software used by the financial services industry to process transactions and verify payments. When routine software updates are rolled out, the update is distributed to tens of thousands of partner and customer networks, allowing the malicious code to infiltrate them simultaneously
A truly holistic cybersecurity approach—one that understands and addresses risks across the entire ecosystem—is more important than ever. This is where technology vendors with expertise in predictive threat detection, compliance, and data-driven decision-making can make a true difference. By leveraging AI-driven security, such vendors can help organizations move beyond reactive strategies and anticipate potential risks before they become critical.
Fragmentation: The Industry’s Persistent Challenge
Data Silos and Tool Fragmentation
One of the biggest barriers to achieving a truly holistic view of payment security is the fragmented nature of the tools and data used to secure the ecosystem. Many organizations still rely on separate systems for fraud detection, endpoint protection, and third-party risk management. While each of these tools is effective in its own right, they often fail to integrate smoothly, leaving critical insights siloed in different places.
Open banking is the perfect example of how third-party vendor dependencies can make cyber risk management more challenging. In open banking, any weakness in the connection between banks and fintechs can open the door for attacks that spread across the system. Case in point: In February of 2024, when hackers breached Infosys McCamish, a major third-party provider for Bank of America, they exposed the PII (including social security numbers and account details) of more than 57,000 customers.
In a similar vein, integrated payment systems need to ensure that connections between payment gateways, processors, and other vendors remain secure, as any breach can lead to a cascading effect throughout the network. The more interconnected the system, the more crucial it becomes to integrate security efforts across every touchpoint to minimize these risks.
Evolving Threats Outpacing Security
The speed at which cyber threats evolve only adds to the challenge. AI-generated attacks, such as deepfake fraud or API manipulation, are becoming more sophisticated and can bypass traditional defenses. These attacks use machine learning to adapt and evolve in real time, making it increasingly difficult for companies to rely solely on conventional methods. Indeed, recent findings from the Entrust Cybersecurity Institute show how deepfake attacks occurred on average every five minutes in 2024 alone.
Regulatory Complexity: A Double-Edged Sword
The payment industry operates under rigorous regulatory frameworks designed to protect cardholder data and maintain trust. Standards like the Payment Card Industry Data Security Standard (PCI DSS) and the EU’s Payment Services Directive 2 (PSD2) mandate robust security measures and promote a holistic approach to protecting sensitive data. These regulations have helped shape a more secure landscape, but they can also create their own set of challenges.
Compliance is often more complex than it looks at first glance. Smaller payment processors with limited budgets might struggle with maintaining a strong security posture while staying on top of constantly changing compliance demands.
Meanwhile, global firms with vast resources still have to contend with multiple regulatory frameworks, which can create additional complexity and potential points of failure. Even armed with solutions designed to integrate compliance into platforms, organizations face the challenge of ensuring these tools line up pristinely with evolving regulations. Nor does it help that a lack of intuitive navigation or real-time compliance tracking in some solutions further compounds the difficulty of meeting the highest regulatory standards.
What Constitutes a True Holistic Solution?
For payment companies looking for a vendor that can provide a holistic cybersecurity solution, there are a few key features to keep in mind:
Interoperability Across Tools
A holistic solution is one that allows various cybersecurity tools to work together seamlessly. For instance, fraud detection systems should communicate with endpoint protection tools in real time to ensure rapid response to potential threats. Without this interoperability, tools could end up working in isolation, making it harder to maintain an integrated defense.
Given how open banking and integrated payments rely on a wide range of third-party vendors, ensuring that all tools and systems can communicate effectively is essential. Data shared between banks, payment processors, and other vendors must be protected at every step, and any vulnerabilities in one part of the system can lead to breaches across the entire network. A unified approach to payment fraud detection helps minimize these risks.
Predictive and Adaptive Capabilities
In today’s cybersecurity landscape, predictive analytics powered by AI is no longer a nice-to-have—it’s a do-or-die necessity. Vendors that use machine learning models can help payment companies identify vulnerabilities and anticipate threats before they become critical. These capabilities allow organizations to take preventive measures and significantly reduce their exposure to potential risks.
What’s more, adaptive technologies that respond in real time to active threats can ensure that payment systems stay protected even as attack methods evolve. This flexibility and foresight are key to building a resilient payment infrastructure.
Ensuring End-to-End Visibility
A genuinely holistic approach requires visibility across every touchpoint in the payment ecosystem, not just the payment processors and merchants. This includes third-party vendors, APIs, and customer endpoints. By offering comprehensive risk assessments and data-driven insights, vendors can help payment companies better understand their interconnected networks and pinpoint vulnerabilities.
Fostering Stakeholder Collaboration
A truly effective cybersecurity strategy also requires collaboration across the payment ecosystem. This means open communication between merchants, banks, vendors, and regulators. Technology vendors can facilitate this collaboration by providing platforms that integrate with existing workflows, making it easier for organizations to share critical information and respond collectively to emerging threats.
Additionally, vendors who offer curated industry insights and threat intelligence can help keep all stakeholders informed and up to date on best practices and new vulnerabilities. This shared knowledge helps organizations stay ahead of evolving risks and refine their strategies accordingly.
The Current State in 2024: Piecemeal or Holistic?
Despite all the progress made in recent years, many cybersecurity solutions in 2024 are still fragmented and reactive. They suffer from common challenges like these:
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Incomplete integration: Vendors that specialize in unified platforms can bridge the gaps between siloed tools, creating more cohesive and coordinated payment security efforts.
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Reactive mindsets: With predictive technologies, vendors can help organizations shift from merely meeting compliance standards to taking a proactive approach to cyber risk management.
- Resource constraints: Scalable and user-friendly solutions can make robust cybersecurity accessible to smaller players, reducing their vulnerability to cyber threats.
A Glimpse into the Future of Payment Cybersecurity
To overcome the challenges of piecemeal cybersecurity solutions, companies in the payments sector will likely need to increase adoption of unified platforms. Companies will increasingly turn to vendors who can provide integrated solutions that bring together fraud detection, endpoint protection, and compliance management.
It’s also clear that AI-powered automation will play a vital role in managing the growing complexity of the payment ecosystem, helping companies stay ahead of emerging threats with less reliance on manual processes.
In Conclusion
The payments industry's complexity demands a cybersecurity strategy that mirrors the interconnectedness of the ecosystem it seeks to protect. By partnering with a technology vendor that offers AI-driven analytics, actionable strategies, and end-to-end visibility, payment companies can begin to close the gaps between fragmented tools and achieve a truly holistic view. Addressing fragmentation, fostering collaboration, and enabling data-driven decision-making are key to securing payment pipelines effectively.
As the industry continues to evolve, selecting the right technology partner is essential for staying ahead of the curve. For payment companies, it’s no longer a question of whether to adopt a holistic approach, but which vendor can best deliver the comprehensive solutions needed to secure the future of payments.
Contact NetraScale Today
Ready to protect your financial firm from generative AI threats and more? Contact NetraScale today to learn how our AI-powered RiskAct solution can help safeguard your data and ensure compliance with constantly evolving standards.
You can also email customercare@netrascale.com for more information about RiskAct.