At the start of the year, the International Monetary Fund’s World Economic Outlook reported that the prospect of global growth is weak against a backdrop of ‘inflation dangers’ confirming that 2023 so far has been a year of economic difficulty as many countries face inflation risks and a cost of living crisis.
Back in February, McKinsey reported that inflation had approached 10% in the US and had also exceeded double digits in the UK and European Union. In a challenging climate of hyperinflation, central banks, including the Federal Reserve raised rates at a pace that has not been seen since the 1980s.
Amid global inflationary pressures, companies and leaders are having to gripple with tightening their budgets and soaring costs. Yet despite the business and financial costs, there are considerable cybersecurity implications that leaders must also face. George Ralph, Global Managing Director at RFA explores why cybersecurity and inflation are closely intertwined.
Globally, the impact of inflation has been greatly felt. According to Forbes, the UK’s Office for National Statistics (ONS) placed the measure of inflation by the Consumer Prices Index (CPI) at 8.7% back in April. It is a figure that has decreased from 11.1% recorded in October 2022, yet it is still painfully elevated.
Due to such inflationary pressures, businesses may feel inclined to reduce their cybersecurity spending. However this could cause more problems as periods of hyperinflation directly impact cybercrime. Last year, Forbes shared a thought leadership piece that explored the ‘combined peskiness of inflation and cybercriminals’, detailing that inflation pressures are a human problem. Whilst everyday consumers and investors are impacted by the soaring prices of goods, the reality is that hackers are also people who are impacted by inflation and the cost of living skyrocketing. Faced with this reality, cybercriminals are more motivated to launch attacks. According to Digitalisation World, the amount of ‘ SMEs paying ransomware demand dramatically increased from 21% to 85% within the last year’. Global Security Mag confirmed that ‘ransomware attackers extorted $456.8 million from victims in 2022’.
Reducing cybersecurity budgets can weaken a firm’s capacity to successfully defend themselves in the event of a cyberattack. Yet it is critical that firms are proactive with their cybersecurity strategies. If firms cut corners, the financial setback can have a devastating impact. According to Forbes, the cost of cybercrime is predicted to hit $8 trillion in 2023 and will grow to $10.5 trillion by 2025. According to Cybersecurity Magazine, 60% of businesses cease to exist after six months of experiencing a cyberattack and that the cost of companies reducing their budget and then falling victim to an attack is approximately $200,000. The reality is that CEOs and the C-suite often struggle to understand the real impact of a cyberattack until they are a victim.
RFA is a world leading cybersecurity firm who works with clients to design, develop and execute upon their cyber defence strategies. Our cybersecurity solutions work to systematically track and analyse assets, identifying any potential vulnerabilities in order to neutralise them before a cyber criminal can act on them. In an increasingly dangerous cyber climate due to inflationary pressures, firms must invest in their cyber defence. If you would like to learn more about how RFA can help you develop your cybersecurity strategy, contact us today.