With the Digital Operational Resilience Act (DORA), the EU has established a new framework to strengthen the financial sector’s defenses against growing cyber risks. DORA has been mandatory since January 17, 2025. The regulation requires robust measures for risk management, incident response, and operational continuity, setting new standards for security and stability in the financial industry.
What Is DORA, and Why Is It Important?
DORA aims to safeguard the financial industry by addressing vulnerabilities in information and communication technology (ICT) systems and ensuring operational continuity. It introduces structured requirements for financial institutions and their third-party ICT providers, supervised by European Supervisory Authorities (ESAs). It also mandates that service providers and vendors comply with its requirements under certain conditions, broadening the scope of accountability across the financial ecosystem.
DORA aligns with other EU regulations, such as NIS2, to foster a comprehensive approach to cybersecurity and resilience across the EU. Unlike NIS2, a directive requiring transposition into national laws, DORA is a regulation that applies directly across all EU Member States, mandating compliance since January 17, 2025, without the need for national implementation.
Key priorities include:
- Ensuring financial institutions and their third-party ICT providers adhere to robust security and resilience standards.
- Maintaining seamless operations during major technical failures or cyber incidents to preserve business continuity.
- Strengthening collaboration across the financial ecosystem to defend against emerging threats.
The Five Pillars of DORA Compliance
To achieve its goals, DORA defines five essential pillars that financial institutions need to implement:
- Cyber Threat Information & Intelligence Sharing: Encouraging collaboration across the financial ecosystem, DORA promotes data sharing to accelerate the detection and containment of cyber threats.
- ICT Risk Management: Organizations must enforce strong access controls and security policies to minimize vulnerabilities. This includes measures like Role-Based Access Controls (RBAC) and Identity Security Posture Management.
- Incident Management and Reporting: Real-time monitoring tools, such as Identity Threat Detection & Response (ITDR), enable institutions to detect and respond to security incidents swiftly, minimizing potential damage.
- Third-Party Risk Management: Financial entities must ensure their ICT providers comply with DORA’s standards, supported by continuous assessments and secure access management protocols.
- Operational Resilience Testing: Regular testing of ICT systems ensures preparedness for technical and cyber disruptions, supporting operational continuity.
Challenges in Meeting DORA Requirements
Despite its benefits, implementing DORA comes with challenges. Financial institutions must navigate complex user and access requirements, including conditional access for remote workers, contractors, and partners while managing an ever-expanding number of applications and entitlements. Cloud adoption and DevOps practices further accelerate the complexity of IAM processes.
Many organizations continue to rely on outdated, in-house IAM tools that lack the scalability and automation required for modern compliance. IDC’s 2024 survey reveals that 49% of financial institutions are aware of DORA but have yet to begin compliance preparations, highlighting the urgency of action [1].
Additionally, DORA’s focus on third-party ICT providers introduces further challenges, as institutions must ensure their vendors meet stringent standards through continuous monitoring and risk assessments. Failing to comply with DORA requirements can result in fines of up to €10 million or 5% of the previous year’s revenue, posing significant risks to both financial stability and corporate reputation.
Leading IAM solutions—especially Identity Threat Detection and Response (ITDR), Identity Governance and Administration (IGA) and Privileged Access Management (PAM)—can address most of the technical requirements for DORA compliance, streamlining processes and reducing risk. To meet these demands, institutions must go beyond basic automation, leveraging AI-driven identity governance to achieve the scalability, agility, and risk reduction necessary for long-term resilience.
Conclusion
DORA is more than a regulatory mandate; it’s a strategic framework for the future of financial security. Now that the January 17, 2025, deadline has passed, financial institutions must meet DORA’s standards. By investing in modern IAM systems and adopting automation, the financial sector can meet compliance demands while building a strong foundation for long-term operational resilience.
Do you need support with DORA compliance? Contact our experts.