Financial Sector Braces for Cybersecurity Challenges Amidst Rapid Digitalization

The rapid advancement of digital technology is transforming the financial industry, presenting both opportunities and challenges for financial institutions. As the sector becomes increasingly interconnected, cybersecurity threats are becoming more sophisticated and complex, posing a significant risk to individual institutions and the entire financial system.

Addressing Emerging Risks

In response to these emerging risks, Japan’s Financial Services Agency (FSA) has launched a comprehensive initiative to address cybersecurity challenges in the financial sector. The agency is working closely with international organizations, industry groups, and relevant authorities to develop effective measures to counter cyberattacks and protect the financial sector.

International Cooperation

The FSA is actively engaging in international discussions on cybersecurity, recognizing that cyber threats can easily transcend national borders. The agency has been participating in the G7 Cyber Expert Group, which was established in 2015 to address cybersecurity challenges. Recent publications from the group include:

“Fundamental Elements of Cybersecurity for the Financial Sector”
“G7 Fundamental Elements for Threat-Led Penetration Testing”

Preparing for Major Events

In preparation for the 2020 Tokyo Olympic & Paralympic Games, the FSA is working closely with relevant ministries, agencies, and industry groups to establish a crisis management system for the financial sector. This includes:

Developing collaborative arrangements within the sector
Establishing a framework for crisis management

The FSA has recognized the importance of threat intelligence in detecting potential risks and proactively addressing cyberattacks. The agency is actively using information provided by industry groups, such as CEPTOAR-Council, to:

Call attention to incidents that could result in similar harm to financial institutions
Conduct more effective threat intelligence and disseminate information to financial institutions

Strengthening Cybersecurity Countermeasures

The FSA is utilizing the progress and evaluation of measures under its current “Policy Approaches” to further strengthen cybersecurity countermeasures in the financial sector. The agency recognizes that cybersecurity risks differ by business type and scale, and is working to develop targeted solutions to address these differences.

Conclusion

As the financial industry continues to evolve, the FSA remains committed to addressing emerging cybersecurity challenges and protecting the sector from potential threats. Through international cooperation, threat intelligence, and information sharing, the agency aims to create a more resilient and secure financial system for all stakeholders.