ISO 27001 in the banking industry

ISO 27001 in the banking industry

Why should banks go with ISO 27001? ISO 27001 does magic in the banking industry? Well… no, unfortunately not. But when “forged” well, an ISO 27001-based Information Security Management System (ISMS) can be used to manage all the different information security frameworks banks are subject to.

ISO 27001 in the banking industry

What is ISO 27001?

ISO 27001 is the international standard that provides the specification for an Information Security Management System (ISMS). This systematic approach consists of people, processes, and technology that helps you protect and manage all your organization’s information through risk management. It is a set of normative requirements for establishing, implementing, operating, monitoring, and reviewing to update and develop an Information Security Management System (ISMS). ISO 27001 is also used for selecting security controls tailored to each organization’s needs based on industry best practices.

Information and regulation in banks

Massive amounts of data are processed and stored by banks, most of it sensitive or very sensitive in nature. Banks must control all that data in line with contractual requirements, but at the same time also be compliant with many laws and regulations governing the security and privacy of all this data.

A few laws and standards that are common, or new, are:

  • RBI Guidelines
  • Payment Card Industry Data Security Standard – PCI-DSS
  • PSD2: Payment Service Directive 2
  • GDPR (EU General Data Protection Regulation)
  • And many other laws and regulations

Having so many different requirements make information security and privacy compliance a very complex task. Although every industry has its fair share of laws, standards, and regulations, the financial and banking industry, together with healthcare, are amongst the most highly regulated industries.

And, as if that is not enough, the fast developments in Fintech (financial technology), besides many opportunities, introduce a lot of complexity to governance and compliance. So, where and how does ISO 27001 settle in?

A single management system

ISO 27001 offers a framework that can bring together the different laws, regulations, and contractual requirements in one ISMS. Its well-thought-out design has also led to the fact that many data protection standards and laws use ISO 27001 as a basis, which makes implementation much easier.

Using a single security management system requires better design and planning in the start-up phase, but once in place, it provides better governance, greater efficiency (less overlap), and more risk control by providing information across the board, pointing out risks, gaps, opportunities, and priorities. Next to that benefit, the ISMS also enables banks to certify against ISO 27001, showing that an independent body has assessed the effectiveness and efficiency of information security controls.

Benefit of certification to ISO 27001 for banks

In organizations that are subject to so many laws and regulations, such as banks and their vendors, the main benefit is compliance. That means being able to prove that controls have been implemented in accordance with all the different laws and regulations from a single, independently certified management system. As mentioned before, a lot of laws and standards are designed with ISO 27001 in mind, which makes working with (supervisory) authorities much easier.

Over the last few years, ISO 27001 has increasingly become a default contractual requirement that banks include in their agreements when selecting vendors – and for good reason. Vendor governance becomes less complicated when security management follows the same ISO 27001 framework approach.

Scope of ISO 27001 in the banking industry

As said, the ISO 27001 framework is not designed to just manage IT security; it is designed to manage information security holistically across the company by  implementing both technical and non-technical controls. ISO 27001 contains 10 clauses and 114 controls divided over 14 control sets.

All the ingredients to have an effective and efficient Information Security Management System are included within the framework, without becoming overly prescriptive in the requirements, enabling the ability to integrate all of the different requirements. This makes ISO 27001 the “one standard to rule them all” – if not magical, then a very strong tool that can work wonders!


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