RBI deputy governor calls for global coordination to counter cyber-attacks

The RBI has proposed to establish robust governance mechanisms for authorised non-bank payment system operators to effectively address emerging cybersecurity risks.

A top Reserve Bank of India (RBI) official on June 5 called for increased global coordination to counter instances of cyber attacks on financial institutions and customers.

Speaking at an event in Mumbai, RBI Deputy Governor MK Jain said countries and financial institutions should work together to prepare a response against cyber-attacks.

For this, the global financial system’s interdependencies need to be better understood by mapping key operational and technological interconnections, including that of critical infrastructure, Jain said.

Better incorporation of cyber risk into financial stability analysis will improve the ability to understand and mitigate system-wide risk, the deputy governor added.

The comments come in the wake of rising instances of cyber-attacks in banking across the globe.  Last week, the RBI had proposed to establish robust governance mechanisms for authorised non-bank payment system operators (PSOs) to effectively address emerging cybersecurity risks.

Towards this goal, the central bank has issued a 'Draft Master Directions on Cyber Resilience and Digital Payment Security Controls for Payment System Operators'.

The draft directions cover governance mechanisms for the identification, assessment, monitoring and management of cybersecurity risks, including information security risks and vulnerabilities. They also specify baseline security measures to ensure safe and secure digital payment transactions.

Jain said a minimum common framework for cybersecurity needs to be devised that outlines best practices and standards for financial institutions to follow. This can help ensure that all institutions are taking the necessary steps to protect themselves from cyber threats, he said.

Further, countries can share information and intelligence about cyber threats and attacks, which can help identify emerging threats and vulnerabilities and enable financial institutions to take proactive measures to prevent attacks, Jain added.

Additionally, countries can work together to develop and implement incident response plans. "This can help to ensure that in the event of a cyber-attack, there is a coordinated and effective response that minimises the impact on the financial sector," said Jain.

Further, cyber-attacks should become more expensive and riskier for the perpetrators through effective measures to confiscate proceeds of crime and prosecute criminals, Jain added.

Finally, countries can collaborate on capacity building and training programmes to ensure that financial institutions have the necessary skills and resources to manage cyber risks effectively, Jain added.

"This can include training on cybersecurity best practices, incident response planning, and the use of advanced technologies to detect and prevent cyber-attacks," Jain said.