2025-03-12
|
10 mins to read
DORA
ICT Risk Management
Cybersecurity
What is DORA? Steps to Compliance and Regulations
The (DORA) compliance deadline was 17 January 2025, giving EU financial institutions two years from its 2023 enforcement date to meet a range of new ICT risk management and incident reporting requirements. Regulatory scrutiny and the need for robust digital resilience continue well beyond the deadline, and taking action now is critical to protecting your operations and reputation.
Below, we’ll delve into the essence of DORA, why it matters for financial services, the regulation’s key requirements, and how can support your journey compliance.
What Is DORA? A Quick Background
With the rise of cyber threats and the increasing reliance of financial services on technology, the EU has implemented DORA. This regulation seeks to safeguard the sector's critical digital infrastructure. It officially took effect on 16 January 2023, with complete enforcement scheduled for 17 January 2025. During this two-year window, organisations were required to align their ICT risk management frameworks, incident reporting protocols, and supply chain oversight with DORA’s standards.
DORA’s scope is broad: it includes traditional banks, insurers, payment processors, asset managers, fintech and cryptocurrency entities. The regulation also extends to third-party ICT providers—such as cloud vendors, data centres, cybersecurity consultants—whose services are critical to the financial sector. By centralising these regulations under one unified framework, the EU aims to reduce fragmentation among member states while reinforcing trust in the overall financial ecosystem.
Why DORA Is Crucial
- Rising Cyber Threats: Financial institutions are prime targets for ransomware, social engineering, and data theft. A single major incident can severely disrupt operations and erode trust.
- Regulatory Harmonisation: Before DORA, institutions had to navigate a patchwork of national and EU-level regulations. DORA unifies these under one structured framework.
- Customer and Stakeholder Trust: In finance, confidence is everything. Systems failures or data breaches can erode trust, causing customer churn and reputational damage. Compliance signals stability and reliability.
Why DORA Matters Now
DORA’s mandates remain in effect, and regulators expect continuous compliance. Being even a few months late can lead to investigations and penalties. The regulation isn’t just about avoiding fines, it’s about building resilience against sophisticated cyber threats.
DORA provides a blueprint for digital resilience, focusing on proactive, repeatable security processes. Organisations that see compliance as an afterthought risk losing money and harming their reputation. This is especially true in a data-driven market where trust is crucial. Since compliance is a continuous process, the sooner you start, the easier your compliance journey will be.
Core DORA Requirements: Focus Areas You Can’t Ignore
1. ICT Risk Management & Governance
DORA requires financial institutions to elevate cybersecurity and digital risk management to the board level. Executives must:
2. Incident Response & Reporting
Quick, transparent incident response lies at the heart of DORA. The regulation:
- Mandates reporting severe ICT incidents to regulators within strict deadlines—at times within just four hours of classification.
- Requires organisations to document their remediation process, categorising severity and notifying clients if the disruption affects service rights.
What to do?
3. Digital Operational Resilience Testing
DORA sets out two main testing categories:
- Regular, Annual Testing: Vulnerability scans, scenario-based exercises, and continuity drills.
- Threat-Led Penetration Testing (TLPT): This must happen at least every three years for larger or important organisations. It often simulates real-world attack situations.
What to do?
4. Third-Party Risk Management
One of DORA’s distinguishing features is its extended oversight of critical ICT service providers:
Every key vendor’s security and resilience posture must be scrutinised—down to contract clauses and fallback plans.
“Concentration risk” is a major concern; relying too heavily on one cloud provider can pose systemic threats.
Critical third-party providers themselves face direct EU supervision, forcing them to meet DORA’s standards alongside their clients.
What to do?
Partner Compliance: A Critical Component of DORA
DORA places significant emphasis on third-party ICT oversight, requiring financial institutions to ensure that their critical service providers—such as cloud providers, cybersecurity firms, and software vendors—comply with DORA’s stringent regulations. This means that your vendors’ security, resilience, and governance practices are just as crucial as your own.
Why Partner Compliance Matters
- Regulatory Accountability: Under DORA, financial institutions are accountable for the compliance of their critical ICT providers. If a partner fails to meet DORA’s standards, it could expose your organisation to regulatory scrutiny, fines, or reputational damage.
- Supply Chain Resilience: Cyberattacks increasingly target supply chains. Ensuring your partners are resilient and compliant reduces the risk of disruptions to your operations.
How BytePitch Supports Your Compliance Journey
At BytePitch, as a trusted partner to financial institutions, we recognise the critical role of third-party compliance in DORA’s framework. As an ISO 27001-certified organisation, we adhere to globally recognised security standards, ensuring that our processes align with DORA’s requirements. By partnering with BytePitch, you can:
- Streamline Vendor Governance: Our ISO 27001-certified processes ensure that we meet the same rigorous standards you are required to enforce across your supply chain.
- Reduce Compliance Risks: Working with a compliant partner minimises the risk of regulatory penalties tied to third-party oversight.
- Build Trust and Resilience: Our expertise in secure systems engineering, incident response, and operational resilience ensures that your organisation is supported by a partner who prioritises compliance and security.
If You’re Not Compliant Yet—Act Now
Regulatory compliance is an ongoing process, not a single checkpoint. If you’ve missed the deadline, follow these urgent steps:
- Conduct a Compliance Audit: Identify weaknesses and misalignments with DORA’s requirements.
- Document & Demonstrate Progress: Show you’re committed to rectifying issues. Keep meticulous records of every improvement action.
- Engage a Trusted Partner: Outside help can streamline complex tasks like incident response automation, vendor contract reviews, or advanced penetration testing.
- Prioritise High-Risk Areas: Prioritise critical systems, third-party dependencies, and incident response workflows. Focus on mission-critical systems, third-party dependencies, and incident response protocols.
The Risks of Ongoing Non-Compliance
Failing to meet DORA’s requirements can lead to:
- Financial Penalties – Regulators can impose fines for non-compliance.
- Reputation Damage – Cybersecurity failures can erode stakeholder trust and customer confidence.
- Operational Disruptions – Severe infractions could lead to partial shutdowns or service suspensions.
How BytePitch Helps You Stay—or Get Back—on Track
BytePitch is a European software and product company dedicated to building solutions that merge innovation with robust security. We support organisations throughout their DORA journey, whether you’re catching up post-deadline or maintaining compliance.
- Systems Engineering & Software Architecture: Build fault-tolerant, scalable systems that meet DORA’s resilience requirements.
- Cloud Infrastructure & Automation: Automate deployments and patching cycles to reduce human error.
- Incident Response & Risk Assessment: Develop structured playbooks and monitoring solutions for real-time threat detection.
- Threat-Led Testing & Resilience Exercises: Conduct advanced penetration tests and scenario-based drills.
- Vendor & Supply Chain Governance: Strengthen contracts, SLAs, and fallback strategies for critical ICT suppliers.
Take Action Now: Strengthen Your Organisation’s Security
The clock is ticking. Every step you take to enhance ICT risk governance, train your team in incident response, and stress-test your resilience framework brings you closer to compliance and a more secure future.
Ignoring the risks isn’t an option. Regulators expect ongoing compliance, and proactive organisations face fewer enforcement actions. Show your commitment to bridging gaps now, and you'll stay ahead of potential penalties.
Need a Fast-Track Plan?
We get it. That’s why we provide expert assessments and tailored solutions to get you compliant—fast.
Take the next step today! or send an email to hello@bytepitch.com to discuss your needs.
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