Banking on Security: Defending UK Financial Services from Cyber Threats

The UK financial services sector is one of the most attractive targets for cyber criminals worldwide.

From banking and investment firms to insurers and fintech’s, organisations in this sector handle high-value data, transactions, and customer trust - all of which make them prime candidates for attack.

As threats evolve, so too must defences. Yet, recent studies highlight persistent challenges: only 30% of leaders strongly agree that their organisation’s financial crime compliance programme is adequately supported by technology and investment, while just 29% believe their governance frameworks are robust enough to manage these risks effectively.

With over 70% of executives anticipating a rise in financial crime risk in 2025, the need for comprehensive cyber resilience has never been clearer.

The Most Significant Cyber Threats Facing UK Financial Services

1. Ransomware and Data Extortion

Ransomware has moved far beyond simply encrypting files. Today, attackers combine disruption with data exfiltration, extortion, and reputational pressure. For financial institutions, even minutes of downtime on trading systems, online banking portals, or payment platforms can cascade into massive financial and operational losses.

Attackers typically:

• Gain access via phishing, exposed remote services, or third-party compromise.

• Deploy ransomware to encrypt critical systems and halt operations.

• Exfiltrate sensitive data (such as contracts, strategies, or customer details).

• Apply pressure through public leak threats or regulatory notification risks.

This double-edged crisis, combining service paralysis with reputational damage, makes ransomware one of the most feared attack vectors in the sector.

2. Business Email Compromise (BEC) and Payment Fraud

BEC remains one of the most profitable cyber threats globally. Unlike malware, it relies on social engineering and trust exploitation, making it harder to detect. In financial services, where large transfers and time-critical authorisations are routine, a single fraudulent request can have devastating consequences.

Common tactics include:

• Spoofing senior executives to request urgent wire transfers.

• Impersonating suppliers or regulators with “updated” bank details.

• Hijacking genuine email accounts to intercept and alter transactions.

With only 23% of leaders rating their compliance programmes as “very effective” at preventing such threats, BEC remains a top concern for UK financial firms.

3. Supply Chain and Third-Party Risks

The financial services ecosystem is deeply interconnected, relying on vendors such as SaaS providers, IT outsourcers, payment processors, and analytics platforms. Each of these represents a potential weak point.

Risks include:

• Malicious code hidden in third-party software updates.

• Breaches in outsourced IT or call centres leaking customer data.

• Weak fintech integrations exposing sensitive financial systems.

Because of the sector’s reliance on interconnected providers, a single supplier compromise can ripple into systemic disruption across multiple firms - a nightmare scenario for regulators and customers alike.

4. Insider Threats and Credential Abuse

Insider threats, whether deliberate or accidental, remain one of the most consistent risks. Malicious insiders may steal or sabotage data, while careless employees might fall victim to phishing, inadvertently giving away credentials.

Key issues:

• Over-privileged accounts not properly restricted.

• Negligent staff clicking on phishing links.

• Contractors or partners with excessive system access.

The potential impact is enormous: one stolen set of administrator credentials could grant attackers access to sensitive personal, financial, and corporate data.

5. Phishing and Social Engineering

Phishing is the entry point for most cyber attacks in financial services. It’s also becoming more sophisticated. 80% of phishing campaigns now aim to steal credentials, often targeting cloud services such as Microsoft 365 or Google Workspace. Attackers use fake login pages that look almost identical to legitimate ones. To make matters worse, 80% of phishing websites now use HTTPS, making them appear trustworthy to unsuspecting users.

Financial institutions are heavily impersonated in phishing campaigns, with attackers creating fraudulent banking portals or fake payment verification pages. Customers as well as employees are at risk - raising both reputational and compliance challenges.

6. Emerging Risks: AI-Powered Fraud and Deepfakes

Artificial intelligence is changing the cyber threat landscape. 61% of executives view the increased use of AI by criminals as a leading catalyst for risk exposure in the coming year, reflecting the sector’s concern about these tools.

AI is already being used to:

• Generate realistic phishing emails and scam messages at scale.

• Create deepfake voices of executives to trick staff into fraudulent actions.

• Forge synthetic identities capable of bypassing KYC checks.

Traditional verification processes are increasingly undermined, requiring organisations to adopt more advanced, AI-driven defensive measures in response.

Building Cyber Resilience in UK Financial Services

Cyber security is an executive-level responsibility that must be embedded into the daily operations of the entire organisation. Best practices in isolation are not enough; resilience comes from a comprehensive strategy that unites governance, technology, and awareness. To achieve this, financial institutions should:

• Invest in layered defences: Deploy firewalls, EDR, and zero-trust models, aligned with strategic priorities.

• Adopt phishing-resistant authentication: Enforce hardware security keys for executives and finance teams.

• Strengthen vendor governance: Mandate rigorous reviews, logging, and breach-notification clauses.

• Harden ransomware resilience: Maintain immutable backups, privileged access management, and segmentation.

• Embed phishing awareness: Provide continuous training and enable real-time monitoring.

• Ensure compliance readiness: Create board-led 72-hour breach playbooks to meet regulatory expectations.

Building a Safer Financial Future: PureCyber’s Role in Supporting the Sector

The UK financial services sector faces a perfect storm of cyber risks: ransomware, phishing, insider threats, supply chain vulnerabilities, and AI-powered fraud. Yet defences across the sector remain uneven, and with so few organisations confident in their governance or compliance effectiveness, the urgency is clear.

PureCyber’s comprehensive service stack is designed to help financial institutions address these challenges head-on:

From 24/7 Security Operations Centre (SOC) monitoring to threat intelligence, penetration testing, and supply chain risk management, our services provide the layered protection needed to stay ahead of cyber criminals. We also deliver compliance support and awareness training, ensuring your teams remain informed and resilient against emerging threats. In a sector reliant on trust and integrity, a strong cyber security posture is a foundational part of building that reputation.

How Can PureCyber Help?

The PureCyber team are here to take over the burden of your cyber security and ensure your organisation’s data remains secure and well managed, with proactive monitoring and real-time threat intelligence - providing you with a comprehensive and reliable cyber department to support you in all aspects of your security efforts, including: 24/7 Security Operations Centre (SOC) services, Managed Detection & Response (MDR/EDR),Threat Exposure Management (TEM) & Brand Protection Services & Penetration Testing.

PureCyber is recognised as an Assured Service Provider by the NCSC to offer governance and compliance consultancy services/audits. Contact our team of compliance experts to enquire about our full range of Governance Support - including Cyber Essentials, ISO 27001, FISMA, SOC1 and SOC2 standards.

Get in touch or book a demo for more information on our services and how we can safeguard your organisation with our expert cyber security solutions.

Email: info@purecyber.com Call: 0800 368 9397