[BreachExchange] Australia Plants Seeds for Fintech Cybersecurity Industry

[Audrey McNeil]

http://www.databreachtoday.com/australia-plants-seeds-
for-fintech-cybersecurity-industry-a-9662

Australia wants to nurture a homegrown cybersecurity specialty in fintech,
a move that is part of a government and industry effort to be less
dependent on technologies from overseas to secure the country's
infrastructure.

Creating new companies is also a vast economic opportunity: the US$100
billion-plus cybersecurity market is expected to nearly double by 2020. But
there are few cybersecurity startups in Australia, and the lack of those
companies has led to discussion of how create a better environment.

Australia's national research agency, Data61, along with several partners,
held the National Fintech Cyber Security Summit last May. It aimed to bring
financial services companies together with government, startups and
researchers to address key issues. A report from the summit, released on
Jan. 31, outlined what some believe have been the barriers to a more active
cybersecurity industry in Australia.

Australia has the talent, but "we have lacked focus and prioritization,"
writes Alastair MacGibbon, special adviser for cybersecurity to Prime
Minister Malcolm Turnbull, in the report's forward. "We are a nation of
innovators, but too often our bright ideas are captured and commercialized
by larger companies based overseas."

In April 2016, the Australian government said it would spend AU$230 million
(US$174 million) over the next four years to bolster the country's
cybersecurity stance through research, education and other initiatives (see
Is Australia Spending Enough on Cybersecurity?).

Relentless Attack

Australia has a large financial services industry. According to the
Australian Trade and Investment Commission, the country manages AU$1.3
trillion (US$850 billion) in funds. The funds management sector has grown,
in part, due to requirements that employers contribute to employees'
retirement savings.

The systems that drive financial services are always at risk. Last year,
the banking industry was shaken after attacks targeting the SWIFT messaging
system, which facilitates international transfers between banks. The most
damaging attack stole $81 million from Bangladesh Bank's account at the
Federal Reserve Bank in New York using fraudulent SWIFT messages. Banks in
Vietnam, the Philippines and Ecuador were also targeted (see Fraudulent
SWIFT Transfers: Congress Queries New York Fed).

Financial institutions often employ some of the most sophisticated and
expensive security technologies to stay ahead. But as cybercrime evolves,
defenders are faced with a constantly changing attack landscape that
requires innovation.

"The growing sophistication of threats has not been solved by the market
sufficiently well enough," the report says.

Next Phases

The next phase in the fintech startup plan is the National Fintech Cyber
Security Design Challenge, in which organizations will describe the
security issues they're facing and how startups might be able to help.
Then, backers of the effort hope to incubate startups to tackle key issues
and eventually help them commercialize products.

The Cyber Security Growth Centre, which will receive AU$30 million in
federal funding through 2020, will coordinate the effort. Last December,
the government launched the Australian Cyber Security Growth Network, a
not-for-profit company to oversee the rollout.

Eventually, a Cyber Security Innovation Lab will be created to help
commercialize cybersecurity innovation in fintech, working with
researchers, companies and government agencies. An emphasis will be on
adoption, as startups often struggle getting their first customer.

"For many startups working hard to get a product or service off the ground,
[corporations] can offer immediate help by bringing them on board as a
supplier," the report says.
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