In today’s world, with the growing use of technological devices, it is vital for us to understand the implications of this situation. One of the biggest consequences of the power afforded to us is the escalation of cybercriminal activity. Due to the digitalization of companies in the field of finance, the minefield of the company’s data as well as the data of the customers is being targeted by cyber thieves. In order to deal with these hackers, companies invest millions and still run the risk of financial loss.

What is Cybercrime?

Cybercrime is a felony involving a network and a computer. Cybercriminals damage and disable computers or other devices for their profit. They also do it in order to spread illegal information. Cybercrimes exponentially affect the financial sector as cybercriminals may attack a person’s private data or corporate information to steal it for malicious purposes.

The frequency of cyberattacks has surged especially in the corporate world as technology has evolved and widened the threat. An increase in work from home and isolated environments has aided these cybercriminals for the worst. An extensive comprehension of cyber risks is needed to avert cyber incidents costing billions.

Downtime, damage to brand reputation, and a decrease in personnel efficiency are some of the catastrophic effects on businesses. Other effects of cybercrime which hamper the efficiency of companies include the following:

Intellectual Theft:

Cybercriminals target the intellectual property of businesses including their strategies, technology, designs for their individual products etc. Most of these significant assets are saved in the cloud where they are exposed to vicious cyberattacks from competitors.

Injury to Brand Reputation:

Tarnishing the name of a reputable company is another significant effect of cyber attacks. The victimized brands lose the trust of their suppliers and customers as they refuse to partner with a company that is unable to protect their sensitive data.

Escalation in Costs:

Businesses that seek to secure their assets must empty their bank accounts as cybersecurity is costly and some of the expenses include:

• Hiring experts in the field of cybersecurity.

• Informing the affected parties of a violation.

• Dealing with the public.

• Insurance premiums.

• Hiring lawyers for damage control.

Loss of Revenue:

Another important aftermath includes the decrease in revenue for the companies involved. Customers and clients tend to move to more secure companies in order to guard themselves against cybercrime. In a worst-case scenario, hackers are prone to extort large sums of money from their victims.

Rethinking Business Strategies:

To protect themselves from cyber attacks, companies have to rethink their techniques to satisfy their customers. The storage and collection of sensitive data such as clients’ personal information, financial status, social security and credit card numbers etc. need to be protected.

In conclusion, the effects of cybercrime can cripple the global economy and disrupt financial businesses such as brokers, banks, insurers etc. Moreover, safeguarding these financial firms is deeply expensive. This can negatively influence the relationship between the company and its clientele. Due to the constant evolution of cybercrime, we need to find more sophisticated solutions.