With the Rise of Digital banks, IPB University Expert Highlights the Importance of Cybersecurity
The emergence of digital banks in Indonesia has caught the attention of Dr Heru Sukoco, a lecturer at the School of Data Science, Mathematics, and Informatics (SSMI) at IPB University. He believes this trend is part of the digital transformation in the economic sector that is also happening globally.
“Digital banks are here to enhance financial inclusion, especially with the support of digital currency. However, their security heavily depends on the cyber technology implemented,” Dr Heru stated in Bogor (6/17).
As an academic, he emphasized the need for strict oversight from the government and the Financial Services Authority (OJK). He also urged the establishment of cybersecurity standards for all digital banks in Indonesia.
Furthermore, Dr Heru suggested that education for the public on digital literacy and information security be conducted on a large scale. “The public needs to understand the risks and safe practices in using digital services,” he said.
He added that financial institutions should begin investing in artificial intelligence (AI) and blockchain technology to detect potential fraud more accurately and efficiently. He emphasized the importance of developing a regular cybersecurity audit framework and promoting transparency regarding security incidents.
“Collaboration between academia, industry, and regulators is essential for the future development of digital banking security,” he stated.
Despite many digital banks having obtained licenses from the OJK and collaborating with major financial institutions, Dr Heru cautioned that digital banks remain vulnerable to cyberattacks such as data breaches and phishing.
He emphasized that there is no 100% guarantee of data security in the digital world. Therefore, he urged the public to be more cautious, ensure the legality of the digital bank they use, and check whether the bank has implemented security systems such as end-to-end encryption, multi-factor authentication, and AI-based anomaly detection.
Other risks to be aware of, according to Dr Heru, include leaks of personal and financial data, unauthorized access to accounts, digital fraud through social engineering, and liquidity risks at new digital banks that lack sufficient capital strength.
As a risk mitigation measure, Dr Heru recommends that the public choose digital banks that also have a conventional physical presence. “I would recommend digital banks that have a real physical organization and assets, as well as official licenses from the OJK and Bank Indonesia,” he concluded. (dh) (IAAS/LAN)
