10 Important Business Banking Security Tips for SMEs and Startups

Now that the world’s rapidly continuing on its digital transformation, safeguarding your business’s financial assets has never been more important. But while a larger, more established institution may have the benefit of experience—as well as a large finance team and deeper pockets to protect itself—a small- and medium-sized enterprises (SMEs) and startups like yours may have only some of these advantages, or even none of them at all. 

Thus, while larger businesses are still often targeted by hackers and other malicious actors, SMEs are widely considered to be easier targets due to their lack of resources and poor grasp of cybersecurity. As such, an SME or startup like yours has to be more proactive when it comes to safeguarding your financial transactions as well as other sensitive information you keep online.

To that end, here are a few important banking security tips that SMEs and startups should consider to sufficiently protect their businesses:

1) Choose the Right Bank

When selecting a digital bank, prioritize security as a key criterion. Do your research and compare different banking institutions based on their security measures and online business banking features. Look for banks that offer robust encryption protocols, two-factor authentication, and proactive monitoring of suspicious activities.

It’s also important to consider the reputation that a particular financial institution has within your industry. For instance, as one of the leading fintech companies catering to SMEs in need of small business banking services in the Philippines,  digital bank Maya has managed to gain a strong following among locally based SMEs, thanks to its history of innovative and highly targeted financial services.

2) Implement Strong Password Policies 

Weak passwords are highly vulnerable to the automated brute-force attacks that are commonly used by hackers. Knowing that, you should ensure that all of your business’s online banking accounts use strong, complex passwords. Each password should include a combination of uppercase and lowercase letters, numbers, and symbols. In addition, your passwords should also be regularly updated to prevent attacks by insiders and other similar threats.

3) Utilize Two-Factor Authentication (2FA)

Two-factor authentication should always be enabled for your business banking accounts. 2FA adds an extra layer of security by requiring a second verification step, such as a unique code sent to a mobile device or generated by an authenticator app. This process helps prevent unauthorized access to your accounts, even if your passwords are compromised.

4) Regularly Monitor Your Accounts

Stay vigilant over your business finances by regularly monitoring your bank accounts. Frequently review transactions and account balances to identify any suspicious or unauthorized activities. You should also set up alerts and notifications to receive real-time updates on account activity and potential security breaches.

5) Educate Your Employees on Security Practices

Your employees are typically the most vulnerable link in the banking security chain. Even if they have the best of intentions, lack of training in the best security practices may make them unwitting accomplices to fraud or data security breaches.  Be proactive and train your employees on best practices for business banking online. This is just as important as acquiring new security systems and technologies, if not more so.
Periodically educate your employees about the importance of password hygiene, recognizing phishing attempts, and reporting any suspicious emails or activities. In addition, emphasize the importance of following clear protocols for handling financial transactions and sensitive information securely.

6) Beware of Phishing Attempts

Phishing attacks remain a common method for stealing sensitive information from businesses. These attacks exploit human nature and complacency and, as a result, are not usually solved through any specific technical fixes. 

Be aware of such a predicament and exercise maximum caution around suspicious emails, messages, or phone calls requesting sensitive banking details. Avoid clicking on links or providing personal information unless you’ve duly verified the source through a trusted channel.

7) Regularly Update Software and Security Patches

While software updates are often inconvenient, they’re necessary for keeping your business’s devices, operating systems, and banking software up to date with the latest security patches and updates. Always make time to update your system with crucial security fixes that protect against known and emerging vulnerabilities.

8) Only Use Secure Wi-Fi Connections

When accessing your business banking accounts, use secure and trusted Wi-Fi connections. Avoid using public or unsecured networks that may expose your business data to possible threats. Utilize virtual private network (VPN) services to encrypt your internet traffic and ensure secure communication between everyone you transact with.

9) Regularly Back Up Your Financial Data

In truth, cybercriminals aren’t the only threats you should watch out for when it comes to your financial data. Natural disasters, hardware failure, and software glitches can also cause problems if you’re not prepared for them.

With that in mind, regularly back up your business’s financial data, including transaction records, invoices, and account statements. Store these backups in secure locations, both locally and offsite. This ensures that you can quickly recover your financial information in the worst-case scenario of a data loss or a security breach.

10) Establish Dual Control for Big-Ticket Financial Transactions

The dual control framework involves requiring multiple authorized individuals within your business to approve and verify transactions, adding an extra layer of security. Implementing dual control for sensitive financial transactions, especially large payments or fund transfers, is especially helpful in preventing fraud and malfeasance perpetuated by company insiders.

Prioritizing banking security is crucial for any SME or startup operating in a global market. Following these important banking security tips can help an SME like yours significantly reduce the risk of financial fraud, data breaches, and unauthorized access to your accounts. 

While initially inconvenient and occasionally expensive, these measures will be worthwhile if they will help you protect your business’s financial assets and ensure the security and trustworthiness of your operations in an increasingly interconnected landscape.