A new study from Cybersmart has revealed that 45% of managed service providers (MSPs) are keeping dedicated reserves to pay off ransomware demands, highlighting growing concern over the sophistication of modern cyberattacks.

The research, conducted in partnership with OnePoll and based on feedback from 900 MSPs across the UK, Europe, Australia, and New Zealand, underscores the mounting pressure on service providers. As cybercriminals leverage advanced AI tools to create deepfakes, generate phishing scams, and develop sophisticated malware, MSPs are opting to prepare financially rather than rely solely on proactive cybersecurity measures.

This approach diverges from government and insurer recommendations, which emphasize prevention over payment. Earlier this year, the UK Government proposed a ban on ransomware payments within the public sector and critical national infrastructure to encourage resilience, yet MSPs continue to operate in an environment of regulatory uncertainty.

Cybersmart’s report reveals that while 36% of MSPs have turned to cyber insurance as a defense strategy, 11% have neither a ransomware fund nor insurance—leaving them dangerously exposed to both operational and reputational fallout.

The rising adoption of AI in cyberattacks has emerged as the top concern for MSPs heading into 2025, cited by 44% of respondents. This marks a sharp shift from the previous year, where AI did not even register on the list of primary concerns. In contrast, ransomware and malware followed closely behind at 40%.

In 2024 alone, 67% of MSPs reported experiencing AI-powered attacks. Cybersmart predicts that figure will climb in 2025 as attackers continue to exploit generative and agentic AI, as well as deepfake technologies.

Meanwhile, MSPs face increasing demands from their clients. The report found that 84% of MSPs are now responsible for managing their clients’ cybersecurity or full IT infrastructure.

Jamie Akhtar, CEO and co-founder of Cybersmart, emphasized the need for MSPs to lead the way in cybersecurity preparedness. “MSPs must be secure and confident in their own defenses if they’re going to effectively support their clients,” he said. “Instead of relying on ransom payments, companies should partner with providers focused on proactive security strategies.”

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News Source: ITPro.com