Society for Worldwide Interbank Financial Telecommunication (SWIFT), the globally recognized international fund remittance system, intends to introduce additional security measures through its new Customer Security Framework. This step is being taken in order to improve customer security worldwide on the SWIFT network. SWIFT’s decision comes on the back of increased banking transaction security threats in India and abroad.
According to a recently concluded audit among SWIFT member banks, 51 leading banks in the country have posted losses of Rs. 485 crores during the April 2013 to November 2016 period. An estimated 56% of these losses resulted from card cloning and net banking threats with no less than 15 separate ransomware attacks occurring each hour in India.
The implementation of SWIFT’s new security measures will begin in January 2018, while member banks in India will have to start providing information regarding mandatory controls from the 2nd quarter of 2017 onwards. As per the new framework, SWIFT will introduce 16 mandatory controls and 11 advisory controls. Each member bank in India’s SWIFT network will have to at least adhere to the mandatory controls in order to continue being in the SWIFT network.
Member banks who do not comply with the new rules will be named as non-compliant entities on SWIFT’s list which will be shared with other network banks as well as the Reserve Bank of India. Subsequently, member banks will have the option of choosing not to deal with these non-compliant banking institutions. SWIFT expects that the introduction of the new security measures would reduce the incidence of fraudulent transactions in India and abroad while simultaneously improving security education and awareness of wire fraud in the banking sector.