Cybersecurity and financial data – eight steps to protecting sensitive systems in a world of rising cyber threats

If you’re a business owner or manager, there’s a fair chance you’ve lost sleep over the safety of your IT and data management systems… and if you haven’t yet, you probably should.

In the wake of high-profile cyberattacks on Marks & Spencer and the Co-Op, the question of how secure your financial systems are has never felt more urgent. These incidents are a reminder no organisation is too big, or too small, to be targeted. In fact, SMEs are often more vulnerable due to stretched resources and less robust IT infrastructure.

So, while the digital tools businesses rely on – from cloud accounting platforms to online banking, payment and CRM systems – offer convenience and efficiency, they also present risk. And when it comes to financial data, the stakes are especially high.

Cybercrime is increasingly sophisticated and for businesses managing financial data, the consequences of a breach can be devastating. Think direct financial loss through theft or fraud, potentially irreparable reputational damage and possible regulatory penalties for non-compliance with standards like GDPR, FCA or HMRC rules. Worse still, if your business holds client data, and client customer data, the impacts can ripple well beyond your own operation, creating a perfect storm and at worst even an existential threat to your business.

Unsurprisingly, at Westcotts, we’re seeing a growing demand from clients seeking to review and strengthen their cybersecurity – especially where it intersects with finance and compliance.

Practical steps to protect your financial data

No solution offers 100% protection, but a solid foundation of good practice can significantly reduce your exposure. Here are eight key steps businesses should take:

1. Use multi-factor authentication (MFA)
   Passwords alone are no longer sufficient. MFA adds a second verification layer – such as an app code, SMS or biometric authentication – to access financial systems.

• Enable MFA on all banking, accounting and payroll platforms
• Use unique, complex passwords updated regularly
• Regularly review access permissions

2. Secure your cloud accounting systems
   Whether you use Xero, QuickBooks, Sage or other cloud-based systems, these must be properly configured.

• Choose providers with strong encryption, regular backups and GDPR compliance
• Apply strict user access controls, limiting who can view or edit financial data
• Use MFA wherever possible.

3. Educate your team
   Human error remains one of the biggest cybersecurity risks, so:

• Run regular training sessions focused on recognising phishing and suspicious activity
• Set up clear processes for staff to report suspected threats
• Encourage caution with links, downloads and payment requests

4. Monitor for fraud
   Cybercriminals don’t always smash down the door – sometimes, they sneak in unnoticed.

• Set up alerts for unusual banking/financial activity
• Review transactions and statements frequently
• Consider AI-based tools that flag irregularities in real time

5. Keep software up to date
   Outdated systems are low-hanging fruit for attackers.

• Regularly update accounting tools, operating systems and antivirus software
• Schedule routine security audits with trusted IT specialists
• Perform penetration testing to identify weak spots before criminals do

6. Backup financial data securely
   If a breach or failure occurs, recovery depends on good backups.

• Use both cloud and offline (e.g. external drive) options
• Encrypt backups and restrict access
• Test your restore process to ensure it works when it matters

7. Limit internal access to sensitive data
   Not everyone needs to see the numbers.

• Use role-based access to financial systems and conduct periodic audits of access privileges
• Remove access immediately staff leave or change roles

8. Secure your email systems
   Email is still a common entry point for fraud, especially in finance.

• Implement email encryption
• Train staff to identify fake invoices, supplier scams and fraudulent payment requests
• Use dual verification for high-value payment approvals

Cybersecurity has gone way past being a job for IT alone – it’s a boardroom issue. With threats rising and attackers growing bolder, taking steps to secure your financial data is not just sensible – it’s essential – and now is the time to be addressing the issue before it’s too late.

At Westcotts, we work with clients to help them stay secure, compliant and resilient. If you’re concerned about your exposure or want to review your current arrangements, we’re here to help.