With financial services being a high-risk sector, the importance of security audits, regulatory frameworks, and evolving defense strategies has never been greater. In an exclusive interview with CXO XPERTS, cybersecurity specialist Rachita Kapoor shares her insights on the biggest challenges in financial security audits, India’s preparedness for cyber incidents, the future of security assessments, and the role of Zero-Trust models in financial cybersecurity.
With financial services being a high-risk sector, what are the biggest challenges in conducting security audits for such institutions?
"Auditing the fortress because every loophole is a liability!"
Financial institutions are under siege, facing an alarming frequency of cyberattacks. Between January and October 2023, India’s financial sector endured over 1.3 million cyberattacks, averaging around 4,400 daily.
This surge underscores the challenges auditors face, including rapidly evolving cyber threats, regulatory compliance complexities, third-party risks, and insider threats. The coexistence of legacy systems with modern digital solutions often creates security gaps.
Moreover, human factors remain a significant vulnerability because hackers innovate daily—but are our defenses evolving too? Therefore, audits should not merely check compliance boxes but aim to build resilience, because in finance, a security lapse isn’t just a risk; it’s a crisis!
From an auditor’s perspective, how prepared are financial institutions in India when it comes to handling cyber incidents?
"Cyber resilience isn’t built in a day—but one breach is all it takes!"
Indian financial institutions are on a journey toward cyber resilience, but preparedness varies.
Recent reports indicate that banks and non-banking financial institutions faced an average of 2,525 cyberattacks weekly over a six-month period, significantly higher than the global average. Irrespective of these numbers, the real quest is: “When cyberattacks knock, will our security stand or shatter?” Because preparedness isn’t about avoiding storms but surviving them.
That is why the RBI has also warned banks of increased cyber threats, urging financial institutions to comply with its Cybersecurity Framework Guidelines to enhance their security posture. While larger financial institutions fortify their defenses with cutting-edge threat detection and incident response frameworks, smaller entities often grapple with outdated legacy systems and constrained cybersecurity budgets.
Having said that, cyber resilience isn’t about having the biggest shield—it’s about having the smartest defense. The real game-changer of preparedness lies not merely in an extravagant cybersecurity budget and automated advanced tools, but in a proactive strategy, swift detection, decisive response, and seamless recovery that ensures business continuity even in the face of evolving threats.
How do you see security audits evolving in the next five years with emerging technologies?
"Tomorrow’s threats need tomorrow’s audits!"
Security audits are evolving from compliance-driven to threat-driven models.
The rise of AI and cloud adoption in financial services has further complicated the security landscape, making Zero Trust an even more relevant approach. Continuous monitoring auditing, leveraging machine learning and automation, is set to replace traditional periodic reviews.
With increasing reliance on APIs and Open Banking, audits must extend beyond internal controls to ecosystem-wide risk assessments. The role of the auditor is shifting, not just to report gaps but to preempt threats, because in cybersecurity, hindsight is expensive, but foresight is priceless.
How crucial are regulatory body-prescribed frameworks, and with emerging variations in threats, how critical is the implementation of such frameworks in an organization?
"Frameworks aren’t just rules; they’re the backbone of resilience!"
In an era where cyber threats mutate faster than regulations evolve, adherence to frameworks like RBI’s IT Governance Guidelines, NIST, ISO 27001, and PCI-DSS isn’t optional—it’s critical survival armor. However, compliance alone isn’t security. Many organizations tick regulatory checkboxes but lack a risk-driven implementation strategy.
As threats evolve, from deepfake frauds to AI-powered phishing, static frameworks won’t suffice. Businesses must customize frameworks, conduct continuous risk assessments, and integrate threat intelligence.
So, the mantra for me is — Comply, but also adapt, because a framework is only as strong as its implementation.
What’s your take on Zero-Trust security models? Are they the future of financial cybersecurity?
"Never trust, always verify—because trust is a vulnerability!"
Zero-Trust isn’t just a buzzword—it’s a necessity.
Traditional network security models, which operate under a trust-but-verify philosophy, increasingly fail to hold up in the face of sophisticated threats. Financial institutions handling sensitive customer data, high-value transactions, and complex third-party integrations cannot afford implicit trust.
Zero-Trust enforces least privilege access, continuous verification, and strict authentication at every touchpoint. While implementation requires cultural and technological shifts, the payoff is immense—reduced attack surfaces, better fraud prevention, and stronger compliance alignment.
Is Zero-Trust the future? It’s already here. The question is—who’s adopting it fast enough?
Final Thoughts
As cyber threats continue to evolve, the financial sector must transition from reactive security measures to predictive, AI-driven defenses. Security audits, compliance frameworks, and Zero-Trust models are becoming critical components in ensuring long-term resilience.
With a decade of expertise spanning financial cybersecurity, threat management, and audit compliance, Rachita Kapoor emphasizes the need for proactive security strategies and continuous innovation in a sector that cannot afford vulnerabilities.
Also read: Ranjni Joshie: Digital Trust in Industrial Automation
As financial institutions adapt to digital transformation, embracing smarter cybersecurity frameworks will be the key to safeguarding trust, assets, and long-term stability in the financial ecosystem.
