Why Is API Security So Important?

Secure design, usage, and management of APIs play a key role in safeguarding sensitive data and ensuring the smooth operation of the digital platforms and applications that rely on them. In an increasingly digital and connected world, APIs are fundamental for businesses across industries—not just finance—as they enable seamless communications between systems and digital services. However, this bridges also introduce risks that malicious attackers can exploit.

This article delves into key aspects of API security, including:

• What APIs are and their purpose.
• What is their purpose?
• The main risks they face.
• Best practices for securing them.
• Tools to protect APIs.

As companies progress in their digital transformation journeys and adopt microservice architectures and API-based solutions, understanding the importance of API security becomes increasingly critical. Proper implementation of security measures protects company and user data, builds customer trust, and contributes to long-term business success.

The concept of API security refers to practices and measures designed to safeguard Application Programming Interfaces (APIs) against threats and vulnerabilities. APIs are integral to the digital ecosystem, acting as intermediaries that enable communication between systems and applications. Their primary role is to facilitate data and service exchanges, making them attractive targets for attackers.

With the growing adoption of “API-fied” solutions for digital transformation, the volume of sensitive information transmitted via APIs has increased. Without proper protection, there’s a significant risk of data breaches, which can result in severe legal and financial consequences.

In microservice architectures, where services communicate through APIs, security not only protects individual data but also ensures the integrity of the entire system. Implementing robust cybersecurity measures is essential to win trust and keep systems working correctly.

Organizations must incorporate these elements into their API security strategies to foster a reliable digital environment.

What Are Microservices?

Microservices are a method of designing applications by breaking them into small, independent components, each responsible for a specific function. Instead of having one large application managing everything, multiple services collaborate, offering increased flexibility and efficiency.

For instance, in a digital banking app, if functionalities like money transfers and account management are part of a single system, a problem with one feature could disrupt the entire application. For example, an issue in the transfer service might also interrupt balance inquiries.

By separating each function into independent microservices, such as one for payments and another for balance checks, a failure in one doesn’t impact the others. If the payment service fails, users can still check their balances without interruptions.

This modularity enhances platform stability, isolates failures, simplifies maintenance, and streamlines updates. Additionally, each microservice can scale according to its needs, improving operational efficiency and reducing risks of widespread outages.

APIs are vital for communication between systems and digital services, especially in sectors like banking, fintech, and investment. However, their use also comes with vulnerabilities that pose significant risks to data security and operational integrity. These vulnerabilities can allow unauthorized access to sensitive information, compromising businesses and users alike.

Moreover, APIs are appealing entry points for cyberattacks, leading to security breaches, financial losses, and reputational damage. Understanding these risks requires referring to well-established standards and guidelines, such as those from OWASP, which offer a solid framework for identifying and mitigating critical vulnerabilities to secure APIs against current threats.

What Is OWASP and Its API Security Top 10?

The Open Web Application Security Project (OWASP) is a nonprofit organization dedicated to improving the security of web applications. Among its initiatives, OWASP regularly publishes lists identifying key security risks in various technological areas. In 2023, it released the API Security Top 10, a guide highlighting the most critical API vulnerabilities.

This list serves as a reference for organizations to identify and mitigate significant threats, ensuring their APIs remain secure. Below is a summary of OWASP’s latest API Security Top 10:

1. Broken Object Level Authorization (BOLA): API allows users to access or manipulate unauthorized data due to poor permission checks.
2. Broken Authentication: Flaws in login processes enable attackers to access accounts without authorization.
3. Broken Object Property Level Authorization: Users can access or modify specific data elements without proper permissions.
4. Unrestricted Resource Consumption: Lack of resource limits can lead to system overload and crashes.
5. Broken Function Level Authorization (BFLA): Users access functions they shouldn’t, such as admin operations.
6. Unrestricted Access to Sensitive Business Flows: Critical actions lack proper restrictions, making them exploitable.
7. Server Side Request Forgery (SSRF): APIs are manipulated to make unauthorized requests to internal systems.
8. Security Misconfiguration: Misconfigurations leave APIs vulnerable, such as overly broad permissions.
9. Improper Inventory Management: Poor tracking of APIs and versions hinders vulnerability identification.
10. Unsafe Consumption of APIs: Trusting unvalidated third-party data introduces security risks.

Other API Security Threats

In addition to the risks outlined by OWASP, other significant threats should be considered when securing APIs. Below are some of these risks, with detailed descriptions and examples:

1. Injection of Malicious Code in Requests (Injection Attacks):
   Attackers may embed harmful code in API requests, exploiting inadequate data validation. This can grant them unauthorized access to manipulate or retrieve sensitive data.
   
2. Unencrypted Data Transmission: When communication between an API and its users isn’t encrypted, data can be intercepted and read by unauthorized parties.
   
3. Improper Credential and API Key Management:
   Keys and tokens used to access APIs must be handled with care. If exposed or mismanaged, unauthorized individuals may exploit them.
   
4. Lack of Input Validation:
   APIs that fail to verify user-provided data are vulnerable to malicious inputs that disrupt functionality. For instance, a user could send excessively large or malformed data, causing system crashes or errors.
   
5. Insufficient Monitoring and Logging:
   Without proper activity logs, detecting anomalies or active attacks becomes challenging. Attackers could exfiltrate sensitive data over extended periods without being noticed due to the absence of activity monitoring.

Implementing best practices is essential to safeguarding APIs from vulnerabilities that could compromise data integrity and service availability. Below are key strategies based on OWASP recommendations:

Input Validation:

Ensuring that API inputs match expected types and formats prevents attacks using malicious data.

• Define clear rules: Specify acceptable data types and reject anything that doesn’t meet criteria.
• Use whitelists: Allow only predefined and safe values.

Verify specific formats: Validate common formats like email addresses, phone numbers, or IDs.

Example: An API expecting a tax identification number should verify its format and length before processing the request.

Robust Authentication and Authorization:

Ensure only authorized users and applications can access APIs.

• Use secure protocols: Implement standards like OAuth 2.0 or JSON Web Tokens (JWT) for authentication.
• Granular access control: Clearly define actions each user type can perform.

Authenticate all requests: Avoid leaving unprotected endpoints exploitable by attackers.

Data Encryption:

Protect sensitive information during transmission between the client and server.

• Use HTTPS: Ensure API access is restricted to secure connections.
• Implement TLS 1.2 or higher: Encrypt data in transit.

Encrypt sensitive data at rest: Not only during transmission but also when stored.

Monitoring and Activity Logging:

Keeping a detailed log of API activities helps identify and respond to potential threats.

• Log all requests and responses: Track suspicious or unauthorized actions.
• Set up real-time alerts: Notify administrators of unusual activity or failed access attempts.

Conduct periodic audits: Review logs to identify patterns or risks.

Continuous Updates and Maintenance:

Security is an ongoing process requiring regular attention to mitigate new threats.

• Keep software updated: Apply patches and updates promptly.
• Review security policies: Adapt to emerging standards and best practices.

Train staff: Ensure teams are familiar with the latest threats and protection methods.

Leveraging tools to prevent, detect, and respond to threats strengthens API security. Below are some effective tools:

Web Application Firewalls (WAFs):

Act as a protective barrier between APIs and external threats.

• Protection from common attacks: Block code injection attempts, denial-of-service attacks, and other threats.
• Real-time traffic analysis: Monitor incoming and outgoing requests to detect anomalies.

Customizable security rules: Tailor configurations to organizational needs.

API Gateways:

Serve as centralized entry points managing all API requests with additional control and security.

• Unified security management: Apply authentication, authorization, and encryption policies consistently.
• Traffic control and rate limiting: Prevent system overloads by limiting requests per user or application.

Centralized monitoring and analysis: Gain visibility into API usage and identify threats.

Security Analysis and Testing Tools:

Specialized tools conduct regular security checks on APIs to identify and address vulnerabilities.

• Vulnerability scanning: Search APIs for known weaknesses.
• Penetration testing: Simulate real-world attacks to assess security robustness.

Automated testing: Integrate security tests into development cycles.

At Prometeo, security is a top priority. Aware of the growing challenges of cyberattacks and fraud, particularly in the financial sector, we design our APIs with high-security standards to protect user data and privacy.

Our co-CEO, an expert in financial cybersecurity, leads a dedicated team to proactively identify and mitigate risks. In services like account-to-account payments, we never store or share banking credentials, using cryptographic bridges to enhance security and privacy.

Our AWS-based infrastructure, fortified with Web Application Firewalls (WAFs) and 24/7 monitoring, provides constant defense against external threats. Prometeo’s ISO 27001 certification underscores our commitment to best practices in information security management.

By fostering a company-wide security culture, training staff, and adhering to strict regulations, Prometeo offers a reliable and secure infrastructure across Latin America, strengthening trust among our clients and partners in the financial market.

API security is essential to safeguarding sensitive data and maintaining customer trust. By adopting best practices and utilizing specialized tools, organizations can:

• Minimize security breaches: Protect confidential information and avoid financial or reputational losses.
• Enhance operational efficiency: Centralize and automate security management to focus resources on innovation and growth.
• Ensure regulatory compliance: Align security practices with industry standards and regulations.

Taking a proactive and continuous approach to API security not only protects organizations but also reinforces their competitive advantage, demonstrating a strong commitment to data protection and user privacy.