Why Is Financial Services a Target for Cyber Attacks?

1. High Value of Financial Services Data

Financial institutions and their suppliers handle sensitive information such as bank account details, payment card data, and personal identification. This data is highly valuable on the black market, making finance services an attractive target for cyber attacks. In fact, over 20 million UK individuals were impacted by data breaches within financial services during 2023—a 143% increase from the previous year. This surge highlights just how aggressively cyber attackers are targeting financial data.

2. Direct Access to Money

Unlike other industries, the finance services sector deals directly with money. Cybercriminals often aim to exploit vulnerabilities to transfer funds, commit fraud, or manipulate transactions. Even suppliers can be targeted as a stepping stone to larger financial institutions. Breaches in financial services cost an average of £5.4 million, significantly higher than the UK-wide average of £3.58 million.

3. Complex Supply Chains

Small businesses supplying to financial institutions often have privileged access to systems or sensitive data. Cyber attackers know that smaller companies may have weaker security controls, making them an easier entry point into the larger ecosystem. In 2024, 58% of large UK financial services firms suffered at least one supply chain cyber attack, and nearly a quarter experienced three or more such incidents.

4. Regulatory Pressure and Reputation

Financial organisations face strict compliance requirements (such as FCA regulations and GDPR). A breach can lead to heavy fines and reputational damage. Cybercriminals exploit this pressure, knowing victims may pay ransoms quickly to avoid public exposure. While FCA-reported cyber attacks fell by 53% in 2024 compared to 2023, the sector still reported 101 incidents between January and October 2024, showing that the threat remains significant.

5. Increasing Sophistication of Attacks

From phishing and ransomware to advanced persistent threats (APTs), attackers are using more sophisticated techniques. The rise of AI-driven attacks and deepfake technology adds another layer of risk, especially for businesses with limited cybersecurity resources. Notably, ransomware accounted for nearly a third (31%) of FCA-reported cyber incidents in 2023, up from just 11% in early 2022—a clear sign of escalating tactics.