Financial Institution Cybersecurity Threats in Burundi Worsening: Experts Warn of Economic Consequences
Burundi’s financial institutions are facing an unprecedented threat from cyber attacks, with experts warning that the country’s economic stability could be severely impacted if adequate measures are not taken to address these risks.
The Growing Threat
According to a recent report by the International Monetary Fund (IMF), cyberattacks have more than doubled since the pandemic, with the financial sector being uniquely exposed to these threats. The report warns that the risk of extreme losses from cyber incidents is increasing, and that such losses could potentially cause funding problems for companies and even jeopardize their solvency.
Prevalence of Attacks
The report highlights that attacks on financial firms account for nearly one-fifth of all cyber incidents, with banks being the most exposed. It notes that a severe incident at a financial institution could undermine trust in the financial system, disrupt critical services, or cause spillovers to other institutions.
Examples of Recent Incidents
- A recent cyber attack on the Central Bank of Lesotho disrupted the national payment system, preventing transactions by domestic banks.
- A 2023 ransomware attack on a cloud IT service provider caused simultaneous outages at 60 US credit unions.
The Role of Third-Party Service Providers
The report emphasizes that financial firms increasingly rely on third-party IT service providers, which can improve operational resilience but also expose them to system-wide shocks. It notes that public intervention may be necessary to address cyber risks, as private incentives may be insufficient to do so.
Strengthening Resilience in the Financial Sector
To strengthen resilience in the financial sector, authorities are advised to develop an adequate national cybersecurity strategy accompanied by effective regulation and supervisory capacity. This should include:
- Periodic assessments of the cybersecurity landscape
- Encouraging cyber maturity among financial sector firms
- Improving cyber hygiene
- Prioritizing data reporting and collection
- Sharing information among financial sector participants
International Cooperation
The report also emphasizes the importance of international cooperation in addressing cyber risk successfully, as attacks often emanate from outside a financial firm’s home country and proceeds can be routed across borders.
In conclusion, Burundi’s financial institutions are facing an unprecedented threat from cyber attacks, with experts warning that the country’s economic stability could be severely impacted if adequate measures are not taken to address these risks. It is essential for authorities to develop a comprehensive national cybersecurity strategy and for financial firms to prioritize cybersecurity as a critical component of their risk management approach.