Rising Cyber Threats Pose Serious Concerns for Macro-Financial Stability, warns International Monetary Fund (IMF) | Current Affairs | Vision IAS
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    Rising Cyber Threats Pose Serious Concerns for Macro-Financial Stability, warns International Monetary Fund (IMF)

    Posted 12 Apr 2024

    2 min read

    • According to IMF’s Global Financial Stability Report 2024
      • The risk of extreme losses from cyber incidents has increased to $2.5 billion
      • The number of cyberattacks has almost doubled since the COVID-19 pandemic.
      • Attacks on financial firms account for nearly one-fifth of the total, of which banks are most exposed. 

     

    • Reasons Behind Rising Cyber Incidents in the Financial Sector
      • Increased digital financial services offer a target-rich environment for hackers. 
      • Insider threats i.e. users have authorized access to assets and misuse their privileges deliberately or accidentally for monetary gain.
      • Cybersecurity skills gap leaving financial firms vulnerable to cyber threats.
      • Geopolitical tensions. E.g. Surge in cyber-attack after Russia’ invasion of Ukraine.

     

    • Impact of Cyber Attacks on Macro-financial Stability
      • Data breaches lead to a loss of confidence in the viability of targeted institutions, resulting in high deposit outflows.
      • Cyber-attacks on payment networks can halt trading, online banking,the  etc., and undermine the country's financial stability.
      • Cyber-attacks propagate rapidly within a network of financial systems through financial linkages, thus impacting market stability.

     

    • Policy Recommendations
      • Strengthen reporting of cyber incidents by financial firms to supervisory agencies.
      • Financial firms should develop and test response and recovery procedures to remain operational in the face of cyber incidents

    World Cybercrime Index

    • The index has been developed as a joint partnership between University of Oxford and UNSW Canberra.
    • India ranked number 10 in cybercrime, with frauds involving people making advance fee payments being the most common type.
    • Russia topped the list followed by Ukraine and China.
    • Tags :
    • World Cybercrime Index
    • Global Financial Stability Report 2024
    • Cyberattack on financial sector
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