Financial Industry Regulations & Security Testing Standards Matrix
From FedRAMP to PCI DSS, navigating requirements is critical for compliance
Companies that perform business within the financial industry, including banking, insurance, and investment companies, operate under a rigorous framework of regulations designed to safeguard sensitive data and ensure digital resilience. From FedRAMP to PCI DSS, navigating these requirements, particularly those pertaining to security testing, is critical for compliance and robust defense against evolving cyber threats. The following matrix offers a comprehensive overview of key security testing mandates and recommendations from prominent regulations and standards globally. Familiarity with these governing bodies and their testing requirements is essential for financial institutions to proactively establish effective security postures, mitigate risk, and maintain the trust of their stakeholders and regulators.
To meet these stringent compliance demands, regular and thorough penetration testing across the entire digital estate is no longer a nice-to-have, but a must-have. This includes rigorous testing of internal and external networks, AI projects, mobile applications, APIs, web applications, hybrid cloud environments, and third-party supply chains.
To navigate the complex landscape of regulations, organizations must adopt a proactive and programmatic approach to security testing. This ensures that vulnerabilities are identified and addressed before adversaries can exploit them, supporting both compliance and resilience. The following matrix outlines the essential security testing mandates and recommendations from leading global standards and regulators, providing financial institutions and related businesses with a clear framework to strengthen their security posture and maintain stakeholder trust.
Defining Common Acronyms
3PAO: Third Party Assessment Organization
CAT: Cybersecurity Assessment Tool
DAST: Dynamic Application Security Testing
DORA: Digital Operational Resilience Act
EAL: Evaluation Assurance Level
FedRAMP: US Federal Risk & Authorization Management Program
FFIEC: Federal Financial Institutions Examination Council
GLBA: Gramm-Leach-Bliley Act
ICT: Information and Communications Technology
IoT: Internet of Things
ISO: International Organization for Standardization
IEC: International Electrotechnical Commission
ITGC: Information Technology General Controls
NIS2: Network and Information Security Directive 2
NYDFS: New York Department of Financial Services
PCI DSS: Payment Card Industry Data Security Standard
PII: Personally Identifiable Information
SOX: Sarbanes-Oxley Act
MAS TRM: Monetary Authority of Singapore Technology Risk Management Guidelines
Security Testing Requirements in Financial Services
This matrix overviews binding financial regulations (such as PCI DSS, GLBA, DORA, and NIS2) with widely adopted security standards and guidance (such as ISO/IEC 27001/27002).
K E Y:
Required Recommended
| Regulation / Standard | Summary | Explicit Test Types Required | Cloud Pentesting Required? | On-Prem / Infra Test Required? | Frequency | Third-Party / Regulator Witness? |
|---|---|---|---|---|---|---|
| Global Standards | ||||||
| DORA (EU) | Focuses on operational resilience for critical financial entities. | Threat-Led Penetration Testing (TLPT), Red Team, Vulnerability Assessments, Threat Modeling | Required for critical ICT services | Required for critical on-prem systems | For systems designated as ‘Significant’ by Testing Authorities, every 3 years (min); more if material changes | Yes— qualified external tester; regulator oversight possible |
| NIS2 (EU) | Broad directive for “essential” and “important” entities, including financial infrastructure. | Appropriate and proportionate technical, operational and organizational measures, such as Pentesting, Vulnerability Scans, Risk Assessments | Recommended | Recommended | Variable; risk-based | Possible, if required by Member State |
| MAS TRM (Singapore) | Mandates rigorous testing for financial institutions regulated by the Monetary Authority of Singapore. | Pentesting, Red Teaming encouraged, Secure Code Review (SAST), Vulnerability Scans | Required for cloud-hosted critical systems | Required | At least annually for internet-facing systems; more for high-risk | Yes—independent tester; regulator can request results |
| PCI DSS (Global) | Applies to any organization that stores, processes, or transmits cardholder data. | Annual internal and external penetration testing (and after significant changes); quarterly internal and external vulnerability scans; application security testing for public-facing web apps | Required if cardholder data is in the cloud | Required | Pentesting: Annually Scans: Quarterly | Yes—ASV for scans; Pentesting validation by qualified tester |
| U.S. Standards | ||||||
| FedRAMP (US Federal) | For Cloud Service Providers selling to US federal agencies. | 3PAO-performed pentesting, Continuous Vulnerability Scanning, Risk Assessment | Required part of annual reassessment for all FedRAMP-authorized cloud systems | N/A (cloud-focused) | Pentesting: Annually Scans: Monthly+ | Yes—by FedRAMP-recognized 3PAO |
| FFIEC Guidelines/CAT (US Banking) | Interagency guidance for federally supervised financial institutions. (CAT is voluntary.) | Pentesting, Red Teaming as part of advanced/best practice | Recommended | Recommended | Risk-based, often annual for critical systems; aligned with institution’s risk appetite. | Optional; recommended for third parties |
| GLBA (US) | Requires financial institutions to protect consumer financial information. | Safeguards Rule testing per recent FTC guidance includes pentesting and vulnerability assessments. | Recommended | Recommended | Periodic; risk-based | Optional |
| SOX (US) | Focuses on controls over financial reporting; security testing supports control effectiveness | IT General Controls (ITGC) Testing | Recommended as part of ITGC, but not a direct SOX obligation | Recommended as part of ITGC conclusions, but not a direct SOX obligation | Annual | External Auditor |
| State Regulations (e.g., NYDFS 23 NYCRR 500) | Varies by state; NYDFS is a common benchmark for the financial sector | Risk Assessments, Vulnerability Assessments, Pentesting | Recommended | Recommended | Annual pentesting and bi-annual vulnerability assessments, plus additional risk-based testing | Optional |
| ISO/IEC Standards | ||||||
| ISO/IEC 27001 | Risk-based pentesting is an accepted method to meet Annex A controls. | Vulnerability Management, Technical Compliance Reviews | Recommended | Recommended | Required by risk-tolerance and ISMS plan and as part of risk audits. | External auditor for certification |
| ISO/IEC 27002 | Recommends Pentesting as a method to verify control effectiveness for ISO 27001. | N/A (guidance document) | Recommended | Recommended | N/A | N/A |
| ISO/IEC 27005 | Threat modeling and risk assessment drive the selection of appropriate testing | N/A (risk management) | Recommended as part of risk treatment | Recommended as part of risk treatment | N/A | N/A |
| ISO/IEC 27035 | Positions testing as a tool to improve incident detection and response readiness. | N/A (incident management) | Recommended for preparedness | Recommended for preparedness | N/A | N/A |
| ISO/IEC 27034-1 | Specifies security testing as a verification method within the application security lifecycle but does not specify a fixed set of tests. | Pentesting, Threat Modeling, Code Review | Required as part of SDLC for cloud apps | Required as part of SDLC; applies across deployment models; all environments used by the application should be in scope based on risk. | Aligned with development lifecycle | Optional |
| ISO/IEC 15408 (Common Criteria) | Mandates formal pentesting, especially at higher Evaluation Assurance Levels (EAL4+). | Pentesting against defined attack potential | Required if product is cloud-based | Required if product has on-prem components | During evaluation | Yes—by licensed evaluation lab |
| ISO/IEC 29147 & 30111 | Testing is used to validate reported vulnerabilities and verify fixes. | N/A (vulnerability disclosure/handling) | N/A | N/A | As needed | N/A |
| ISO/IEC 27017 & 27018 | Recommends both provider and customer conduct testing to validate cloud security. | N/A cloud controls/PII) | Recommended risk-based, shared responsibility | N/A | Periodic; risk-based | Optional |
| ISO/IEC 27400 | Specifies security assessment activities for IoT and connected devices. | Security Assessments, Threat Modeling | Recommended | Recommended | Aligned with product lifecycle | Optional |
| ISO/IEC 19790 | Requires testing to assess resistance to known attacks for cryptographic module validation. | Pentesting of cryptographic module | Required if module is software/ cloud-based | Required if module is hardware | During validation | Yes—by accredited lab |
Achieve Compliance and More with NetSPI
To protect against evolving threats and maintain compliance, organizations must build an operational approach that prioritizes their commitment to maintaining customer trust. The compliance standards and security testing best practices explained above outline that approach. This includes continuous testing of the areas often exploited by adversaries, such as internal and external networks, mobile applications, and APIs.
NetSPI’s comprehensive security testing services empower financial entities to proactively address critical vulnerabilities, strengthen their security postures, and ensure alignment with complex and evolving regulations. Let’s advance your security testing strategy together.
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