Today, the digital nature of banking, financial services, and insurance (BFSI) organizations brings several benefits to customers that expect real-time data and continuous availability; however, this also makes them more vulnerable to cyber threats than ever before. With the need to deliver reliable services globally, financial businesses face the risk of IT service disruptions that could impact not only their own operations, but also the broader economy.
This increased reliance on digital service delivery in the financial sector underscores the importance of strengthening cybersecurity and digital operational resilience.
In order to adapt to ever-evolving risks, financial orgs need to consider:
- Compliance Costs: Rising compliance costs require firms to update policies, invest in tech, and perform regular testing.
- Operational Changes: Significant operational adjustments, often involving new technologies and processes.
- Vendor Relationships: Stricter vendor management demands enhanced due diligence, contract adjustments, and continuous monitoring.
- Regulatory Oversight: Regulatory scrutiny is increasing, with potential for on-site inspections and audits.
- Cross-Border Considerations: Operating across borders brings complexities, simplifying compliance and adhering to regulatory requirements.
DORA is Set to Fortify BFSI Organizations
The Digital Operational Resilience Act (DORA) is reshaping the landscape for risk management, requiring businesses to prepare for Information Communication and Technology (ICT) disruptions. DORA has broad-reaching implications, with a compliance deadline of January 17, 2025. It applies to a wide range of financial entities within the EU, including credit institutions, investment firms, insurance companies, crypto-asset providers, and ICT third-party service providers. Here’s what DORA requires:
- ICT Risk Management: Establish robust frameworks to identify, manage, and mitigate ICT risks.
- Incident Reporting: Ensure mechanisms are in place for detecting and managing incidents, with timely reporting to authorities.
- Resilience Testing and Audits: Regularly test and audit resilience through methods like threat-led penetration testing.
- Vendor Risk Oversight: Manage ICT third-party risks throughout the vendor lifecycle, with strong SLAs and audit rights.
- Exit Strategies: Develop exit strategies in contracts to ensure data continuity and security during contract termination.
- Information Sharing: Facilitate cyber threat intelligence sharing to enhance collective ICT risk management.
By setting these requirements, DORA aims to ensure that BFSI organizations have effective resilience frameworks and can quickly recover from potential service disruptions.
How Open Source Postgres Database Empowers BFSI Orgs to Meet DORA’s Standards
Postgres is an excellent choice for BFSI organizations working to meet DORA’s stringent requirements, offering enhanced flexibility and adaptability over legacy database systems. Its open source nature allows businesses to implement customized risk management frameworks that can adapt quickly to emerging digital threats, addressing both resilience and security needs. Unlike costly proprietary systems, Postgres provides a compliance-ready platform at a lower cost, with built-in secure access management, audit trails, and timely incident reporting that eliminates the need for additional licensing fees.
Postgres’ adaptability also makes it ideal for cross-border operations, enabling orgs to meet both EU-wide and country-specific regulatory standards seamlessly. Additionally, it facilitates effective vendor risk management by embedding necessary controls directly within the database, supporting BFSI businesses in complying with DORA’s vendor oversight requirements.
Supported by a vibrant open source community, Postgres continuously innovates with ongoing security and performance enhancements, keeping financial organizations well-equipped to handle evolving regulatory demands. Together, these strengths make Postgres a powerful solution for BFSI orgs aiming to achieve both enhanced compliance and operational resilience.
Enhancing BFSI Security with EDB Transparent Data Encryption
EDB’s Transparent Data Encryption (TDE) for Postgres is designed to help BFSI organizations effectively meet DORA’s data security requirements in the following ways:
- Advanced Data Security: TDE encrypts data at rest, protecting sensitive financial information from unauthorized access.
- Compliance-Ready: TDE supports compliance by aligning with DORA’s requirements for ICT risk management and incident reporting.
- Seamless Integration: Built to work within the Postgres ecosystem, TDE allows firms to secure data without disrupting operations, helping them meet DORA’s requirements while minimizing operational change costs.
- Vendor and Third-Party Risk Management: TDE allows firms to implement secure third-party risk frameworks and enforce strong controls for data access and audits.
- Cross-Border Flexibility: TDE’s adaptability supports compliance with DORA’s cross-border requirements, making it an excellent choice for financial institutions operating internationally.
In summary, EDB’s TDE for Postgres provides BFSI organizations with a secure, compliant, and efficient data management solution, meeting DORA’s rigorous resilience standards.
Navigating the Path Forward
With the standards outlined in DORA, the benefits of Postgres database, and implementation of enterprise-grade security tools like EDB’s TDE, businesses in the financial sector will strengthen their data security, compliance, and digital resilience—factors that simply cannot be ignored in the modern business landscape.
Want to learn more about how to better equip your business for these changes? Explore Postgres' powerful security capabilities in our white paper, "Security Best Practices for PostgreSQL."
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