Estonia’s Finance Sector Warned of Growing Cyber Threats
Cyber Attacks on the Rise in Estonia’s Financial Sector
Tallinn, Estonia - The financial sector in Estonia has been warned about the increasing threat of cyber attacks, which have more than doubled since the pandemic. According to a recent report by the International Monetary Fund (IMF), the risk of extreme losses from these incidents is on the rise, with potential funding problems and even insolvency for companies.
Vulnerabilities in the Financial Sector
The financial sector in Estonia is particularly vulnerable to cybercrime due to the large amounts of sensitive data and transactions it handles. Banks are among the most targeted institutions, accounting for nearly one-fifth of all attacks.
- The report highlights that a severe cyber attack on a bank could lead to market selloffs or even runs on banks.
- A recent ransomware attack on a cloud IT service provider in 2023 caused simultaneous outages at 60 US credit unions.
Consequences of Unchecked Cyber Attacks
Experts warn that if left unchecked, these incidents could erode confidence in the financial system, disrupt critical services, or cause spillovers to other institutions. To address this growing threat, Estonia’s authorities are advised to develop an adequate national cybersecurity strategy accompanied by effective regulation and supervisory capacity.
Recommendations for Mitigating Cyber Threats
To mitigate the growing cyber threats, the IMF recommends:
- Periodically assessing the cybersecurity landscape
- Encouraging better cyber governance among financial sector firms
- Improving their online security
- Prioritizing data reporting and collection of cyber incidents
International Cooperation Crucial
International cooperation is also crucial in addressing cyber risk successfully, as attacks often emanate from outside a country’s borders and proceeds can be routed across borders. The IMF has been actively helping member countries strengthen their cybersecurity frameworks through policy advice and capacity-building activities.
Conclusion
The financial sector in Estonia must take immediate action to address the growing threat of cyber attacks. By developing an adequate national cybersecurity strategy, improving online security, and prioritizing data reporting and collection, authorities can help mitigate these risks and ensure the stability of the financial system.