Cybercrime and Cybersecurity: FinTech’s Greatest Challenges

Abstract

The arrival of financial technology (“FinTech”) companies can be traced to a number of regulatory changes made after The Great Depression of the 1920s. Among others, the United States Banking Act—which separated commercial banking from investment banking (and thus, limited the interest that a regular bank depositor could get on his deposit)—spurred, in the 1970s, the emergence of asset management firms and other forms of shadow banks—or what is now called FinTech companies. However, it was the global financial crisis of 2008, and the near-collapse of the financial system, that caused the rise of FinTech companies and activated the FinTech transformation that the world is currently witnessing. From payments and remittances to lending and wealth management, FinTech continues to change the way we live and bank. But by virtue of their operations, FinTech companies constitute a particularly attractive target for cybercriminals. This article examines how cybercrime affects FinTech companies—mostly startups—and how these companies protect their data and infrastructure.