How to Protect Your Bank or Fintech Against Ransomware Attacks

Cybersecurity threats, particularly ransomware, continue to escalate in volume and complexity daily. For banks, fintechs, and other organizations in the financial services sector, the consequences of a successful attack can be swift and severe, including disrupted operations, compromised customer data, economic losses, reputational damage, and increased regulatory scrutiny, among others.

In Q1 2025, ransomware attacks reached a record high, with more than 2,000 organizations falling victim. As threat actors increasingly target digital financial services and the third-party service providers that support them, banks and fintechs must remain vigilant and take steps to enhance their cyber resilience in an evolving risk environment.

The Rise of Ransomware

Financial institutions have long been targets for cybercrime. With banks and fintechs handling vast amounts of sensitive personal and financial data—and facilitating real-time, high-value transactions—they are a prime target for malicious actors seeking to gain leverage and secure fast payouts. As fintechs continue to drive innovation and banks advance their digital transformation agendas, security gaps often emerge. Misconfigured APIs, unpatched software, and vulnerable third-party integrations all create entry points for cyber threat actors to establish a foothold.

Payments infrastructure is particularly vulnerable to ransomware attacks. In December 2023, ransomware attackers infiltrated a third-party business continuity and disaster recovery provider, triggering a chain reaction that affected another unit of the vendor’s parent company—a key data processor serving credit unions. The breach resulted in widespread outages, shut down data centers, and disrupted online and mobile banking services, leaving many members unable to access their accounts.

This incident highlights how issues in key payment systems can pose widespread risks throughout the financial system. Whether targeting digital wallets, bill pay platforms, Automated Clearing House (ACH) networks, or card processors, ransomware attacks can quickly lead to liquidity challenges and erode customer trust. When core or third-party systems are compromised, the operational fallout can escalate rapidly, impacting not just one institution but potentially rippling across the broader financial ecosystem.

How Banks and Fintechs Can Strengthen Cyber Vigilance

Banks and fintechs may operate at different scales and speeds, but they face similar threats, often from the same attackers.

Keep these best practices in mind as you seek to build better ransomware and cyber risk management strategies.

Stay informed and share insights. Cyber threats evolve fast, from AI-driven phishing to cloud vulnerabilities. Stay current on the latest risks and ensure updates are communicated across the organization, especially to leadership and risk owners.
Train employees to spot threats. Human error is a common entry point. Provide regular, practical training to help staff identify phishing emails and suspicious links and know how to report them.
Patch and configure systems proactively. Don’t wait until it’s too late. Attackers often exploit known vulnerabilities, so keep software updated and systems properly configured.
Monitor for unusual activity. Watch for odd login patterns or access attempts, especially through Remote Desktop Protocol (RDP). Look for signs like repeated login failures or use of stolen credentials.
Keep backup and recovery plans current. Ensure backups are tested and your disaster recovery plan is aligned with today’s threats. Business continuity is key to limiting damage from a ransomware attack.
Encrypt sensitive data. If attackers get in, encryption makes it harder for them to use or sell your data, protecting customers and reducing regulatory exposure.
Evaluate cyber and business interruption insurance. Insurance can help mitigate financial losses and recovery costs. Review your coverage and determine how it fits into your broader risk strategy.
Strengthen vendor and threat monitoring. Integrate real-time threat intelligence into your cybersecurity and third-party risk programs. Keep tabs on vendors and detect vulnerabilities before they’re exploited.
Streamline your processes. Risk management isn’t a one-person job. Maximize your time and resources with risk and compliance software tailored to your institution’s unique needs.

Ransomware Incident Response: What to Do Next

While you can take the necessary steps to mitigate ransomware attacks, they’re not entirely unavoidable. If you experience a breach, use this framework as a guide for responding to internal and third-party-related incidents.

Isolate the threat. Ransomware spreads fast, so act quickly to isolate affected systems and stop it from moving across your network. Disconnect compromised endpoints and launch your incident response plan. If a vendor is hit, assess how their systems connect to yours. Software as a Service (SaaS) platforms may not require action, but if systems are integrated, disconnect immediately, and consider shutting down impacted machines.
Evaluate the scope. Identify which systems, functions, or departments are affected, determine whether sensitive data was accessed or encrypted, and confirm whether the attack is ongoing or contained. If the breach involves a third-party vendor, request a formal incident report to assess their response and recovery efforts.
Inform your legal team. Before notifying authorities, consult legal counsel. Cybersecurity concerns make staff and institutions more sensitive, and a false alarm could trigger unnecessary panic. Avoid drawing attention to a vendor breach if it doesn’t directly affect your financial institution. That said, if there’s a real issue, don’t stay silent—state and federal rules often require you to report certain incidents, so make sure you know what’s expected and follow through.
Start business continuity plans. Ransomware can affect multiple critical systems, so your business continuity plan (BCP) must coordinate response efforts across IT, cybersecurity, compliance, legal, and business teams. While not event-specific, the BCP should integrate with your incident response, disaster recovery, and communications plans, with regular scenario testing to ensure it adapts to shifting recovery priorities during an attack.
Talk to your customers. Breaches often attract public attention, so your financial institution must be ready to address consumer questions. Make sure customer service representatives are prepared to provide clear, accurate responses during the initial phase.
Review your and your vendors’ cyber insurance policies. Don’t assume general liability or business interruption insurance covers cyber incidents; even cyber policies may exclude vendor breaches or cyber terrorism. Understand whether your coverage includes first-party protection (for direct costs like notifications, business interruption, and extortion) or third-party protection (for claims from customers, partners, or vendors).
Strengthen your cybersecurity and vendor monitoring program. Apply lessons learned from ransomware incidents. For internal incidents, perform root cause analysis, patch vulnerabilities, and enhance endpoint detection and response (EDR). For external incidents, reassess vendor due diligence and require proof of their cybersecurity maturity through regular risk assessments, certifications, and recovery testing.

As ransomware threats increase, banks and fintechs must adopt proactive, comprehensive cybersecurity measures — staying updated on threats and requirements (with the help of compliance management software), training staff, and strengthening vendor oversight. By embracing these strategies, they can significantly reduce their risk exposure and build stronger defenses against evolving cyber threats.