Conceptualising cybersecurity risk of fintech firms and banks sustainability
2020
Traditional banks are replete with conventional financial mechanisms is being subjected to
enormous pressure to minimise costs in a sustainable way. For instance, offering low-interest
rates, which squeeze the overall margin. Due to the high demand for a tailored portfolio of
products, the availability of sophisticated communication and advance transaction mechanisms
lead to an emergence of new types of firms known as financial technology service (i.e., fintech).
Recently, the collaboration between these fintech organisations and banks has increased to
lessen the bureaucracy and provide fine-tuned service to the consumer. Albeit, such
collaboration has increased the cybersecurity risk for both fintech firms and conventional banks.
Prior research has scant to acknowledge the cybersecurity risk and the sustainability of these
fintech-bank collaborations. Hence, the dilemma is whether the bank should pursue such
collaboration to resuscitate the profit margin; or be pragmatic and shirk to eliminate
sustainability risk. We propound that the cybersecurity risk is much higher after the collaboration
happens in banks. Types of cybersecurity risks are highlighted, and a theoretical model has been
developed. We propose that if both fintech and the conventional banks collaboratively abate these
cybersecurity risks, then yielding the profitability is much convenient.
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