Digitalization of the international financial market: opportunities, risks and aspects of cyber security

Abstract

This article discusses digital finance and its implications for financial inclusion and financial stability. Digital finance through fintech providers has positive effects for financial inclusion in developing and developed economies, and the convenience that digital finance provides to low and variable income individuals is often more valuable to them than the higher costs they would pay to access such services from conventional regulated banks. Despite the benefits of digital finance, this article has highlighted some of the challenges that digital finance poses to financial inclusion and financial stability. Digital technologies are not only modernizing the financial system, but also require a new level of digital responsibility and security. In the digital age, cyber security is becoming an integral part of financial stability. It determines the level of trust in banking and financial institutions, ensures the reliability of the payment infrastructure and forms the basis for sustainable economic development. Only under the conditions of an integrated approach that combines technological innovation, effective regulation and personnel training, digitalization will become a driver of progress and not a risk factor for the financial system.

The purpose of the study is to analyze the processes of digitalization of the financial system, to identify the main cyber threats that arise in the process of digital transformation of the financial sector, as well as to develop recommendations for increasing the level of cyber security of financial institutions. The scientific novelty of the work consists in the deepening of theoretical approaches to the study of digitalization of the financial system and the justification of modern mechanisms for ensuring the cyber security of the financial sector and in the analysis of the impact of digitalization processes on the functioning of the international financial market, taking into account the relationship between technological innovations, financial stability and cyber security.

 In particular:

• systematized the main cyberthreats arising in the process of digitalization of the financial system;
• improved approaches to the assessment of cyber risks in financial institutions;
• directions for increasing the cyber resilience of the financial system in the conditions of digital transformation are proposed.

The following methods were used in the research process:

• method of analysis and synthesis - for researching the theoretical foundations of digitalization of the financial system;
• comparative method – for analyzing approaches to ensuring cyber security in the financial sector;
• statistical method – for analyzing indicators of the development of digital financial services;
• systemic approach – for a comprehensive study of cyber security of the financial system;
• generalization - for the formation of conclusions and recommendations.

The practical significance of the work lies in the possibility of using the obtained results to increase the level of cyber security of financial institutions and improve mechanisms for protecting financial information.

Conclusions. The proposed recommendations can be used by banks, financial institutions and state regulatory bodies to minimize cyber risks and ensure the stability of the financial system in conditions of digitalization.