What are SaaS Security Risks and Challenges and How to Prevent Them

Although you use them every day - the security risks that come with SaaS tools handling client data are very real. Although this could seem like old-fashioned paranoia the fact remains that your whole system and client information can be compromised - leading to EXPENSIVE fines.

Understanding the security risks in SaaS and knowing how to prevent them is an absolute must to protect your data and follow compliance laws. 

To help you out, we’ll walk you through all the SaaS security risks you need to pay attention to in your business.

Why is It Essential to Have Security for Your SaaS Apps?

1. Intellectual Property and Data Theft

First and foremost, SaaS apps often store sensitive intellectual property and customer data, making them attractive targets for cybercriminals. Unauthorized access can lead to data theft, reputation damage, and lost competitive advantage. 

To avoid this, companies must take steps to protect information and files related to confidentiality and operations and to make sure that your data remains safe and from exploitation or competitors. Some of the steps companies can take include:

• Using strong encryption protocols to protect stored and transmitted data.
• Encouraging regular audits to identify vulnerabilities in the system.
• Training employees on recognizing phishing attacks that can compromise credentials.
• Choosing vendors with a proven track record of reliable security measures.

2. Vulnerability of Business Operations to Hackers and Competitors

Without proper safeguards, hackers and even competitors can exploit SaaS apps to disrupt business operations. For most founders,  the idea of being targeted by hackers can sound very unrealistic. But the fact is that hackers still very much exist - with even companies like Deloitte being targeted. Unauthorized access can lead to downtime, lost productivity, and exposure to strategic plans. Here are some ways you can stop this:

• Regularly update and patch SaaS applications to fix security flaws.
• Use multi-factor authentication to make unauthorized logins harder.
• Keep track of user activity logs for unusual or suspicious behavior.
• Limit access rights based on user roles to reduce unnecessary exposure.

3. Compliance with International and Local Data Privacy Laws

​​SaaS apps often handle personal and financial data, requiring businesses to comply with regulations like GDPR or CCPA. Failing to do so can result in fines and legal issues.

• Review and understand data privacy laws in relevant jurisdictions.
• Have data processing audits to make sure there is regulatory compliance.
• Establish clear data retention policies for your SaaS applications.
• Work with SaaS providers who have compliance certifications.

4. Expensive Data Breaches and Ransomware

Data breaches are costly, affecting not only finances but also customer trust. Ransomware attacks can paralyze businesses, making recovery expensive and time-consuming. 

• Back up important data regularly and store backups in local servers or secure clouds.
• Install endpoint protection tools to defend against malware attacks.
• Use secure file-sharing protocols to reduce exposure during data transfers.
• Educate employees on avoiding ransomware traps like fake email links.

5. Protection from Internal Threats

Internal users, whether careless or malicious, can cause vulnerabilities in your company and through SaaS applications. Some of these things can be unauthorized actions that can lead to data leaks or employees intentionally sharing confidential info with competitors.

• Use strict access controls based on employee roles.
• Have background checks for sensitive positions handling confidential data.
• Log and review user activities to detect unusual behaviors.
• Have regular security training for employees to reduce accidental risks.

What Type of Security and Compliance Do SaaS Apps Usually Have?

SaaS providers often use several layers of security to protect user data and maintain compliance with industry standards. These include encryption, identity management, and security certifications. While these measures improve safety, customers still share responsibility for securing their data.

• Encryption protocols make sure that data is unreadable during transit or storage.
• Access control measures prevent unauthorized users from accessing sensitive information.
• Security certifications (e.g., ISO 27001) show compliance to industry standards.
• Regular penetration testing identifies and addresses potential vulnerabilities.

What are the Common Issues and Security Risks in SaaS Applications?

1. Siloed and Non-Centralized Access Management

​When access to SaaS apps isn’t centralized, managing permissions becomes chaotic. This increases the risk of unauthorized access and data breaches. This would mean that both admins and CSOs/CIOs have little to no sight into who is accessing what file and when. Who knows these passwords and where they are storing them? There is no proper system in place for this. This is where an IAM framework adds control to your company.

• Use single sign-on (SSO) solutions to improve access management.
• Regularly audit user accounts to remove inactive or unnecessary ones.
• Have role-based access to align permissions with job functions.
• Keep track of unusual login attempts or non-typical activity across apps.

2. Shadow IT

What is shadow IT? Well, put simply, Shadow IT refers to unauthorized SaaS apps used by employees, creating chances of data leaks and non-compliance. Every employee is likely guilty of this, to help speed up their tasks or help them analyze data better - but when it comes to these apps a lot of them might now be the most secure. 

These apps often bypass IT department oversight - which is why it’s a good idea to:

• Have an inventory of all SaaS apps in use across your company.
• Educate employees on the risks of using unapproved apps.
• Have a formal approval process for adopting new SaaS tools.
• Use monitoring tools to detect and control shadow IT activities.

3. Misconfiguration During Set-Up or Updates

Badly done configurations can leave SaaS apps vulnerable to cyberattacks or compliance violations. Even small mistakes can have big consequences. But to avoid these, there are some steps you can take that we’ve listed below:

• Follow best practices for configuring SaaS apps during setup.
• Use tools to detect and fix configuration issues automatically.
• Make sure updates are tested in a controlled environment before deployment.
• Have documentation for configurations to simplify troubleshooting.

4. Compliance with Data Laws and Compliance Standards

Meeting diverse compliance requirements can be hard, especially when using multiple SaaS applications across different regions.

• Use SaaS vendors that align with your industry’s regulatory needs.
• Conduct regular audits to assess compliance gaps.
• Create policies to manage cross-border data transfers securely.
• Train employees on compliance requirements relevant to their roles.

5. Making Sure the Customer's Privacy

Protecting customer data is important for maintaining trust and avoiding legal challenges. Data misuse can lead to customer churn and reputational harm.

• Use anonymization techniques for sensitive customer data where possible.
• Limit access to customer data to only those who need it.
• Monitor data usage to ensure it aligns with privacy policies.
• Give customers clear options to manage their data preferences.

6. Uploading Privileged Information to Apps With Minimal Visibility on Usage

Sensitive data stored in SaaS apps must be tracked to make sure that it isn’t misused. Lack of visibility into who accesses or modifies this data can lead to serious issues.

• Allow detailed audit trails for data access and modifications.
• Restrict file-sharing permissions to prevent unauthorized data transfers.
• Use data classification tools to tag and monitor sensitive information.
• Review app usage reports regularly to identify anomalies.

How Do Companies Use SaaS Apps - Are They Secure?

AI for Better Insights and Data Management

AI-powered SaaS apps provide advanced analytics and automation. While useful, they require secure processes to be put in place to protect sensitive insights.

• Choose AI tools with strong data encryption and privacy safeguards.
• Audit algorithms to ensure ethical data usage and compliance.
• Limit the data inputs for AI to what is necessary for its operation.
• Monitor AI outputs for potential biases or inaccuracies.

Customer Relationship Management

CRM platforms help manage customer data but can be a target for breaches. Keeping this data safe makes sure that there is better trust and business continuity.

• Use access controls to restrict CRM data to relevant teams only.
• Regularly update CRM software to address emerging vulnerabilities.
• Encrypt customer communication logs and transaction details.
• Have routine checks on third-party tools to see if they are compromising any of your information in any way.

Lead Generation and Marketing

SaaS tools for marketing collect vast amounts of customer data! This makes security essential for preserving trust and making sure there is compliance in your marketing tasks. Here are some ways you can do this:

• Make sure that marketing tools are compliant with data privacy regulations.
• Monitor data collected during lead generation campaigns.
• Avoid storing unnecessary customer information to minimize risk.
• Train teams on securely handling customer leads and marketing lists.

Project Management

Project management apps store task details, timelines, and resources. Securing these tools prevents unauthorized access to sensitive projects.

• Set user permissions to make sure that access aligns with project roles.
• Use secure connections when collaborating on shared documents.
• Encrypt project files stored within the platform.
• Monitor access logs to detect unusual project activity.

Sharing Memos

Note-sharing apps are convenient but can be exploited if not secured properly. Sensitive ideas or proprietary plans could be exposed to unauthorized users.

• Use password protection for shared notes containing sensitive data.
• Limit sharing permissions to groups and employees you trust.
• Regularly review shared notes to remove outdated or unnecessary content.
• Choose note-sharing apps that include end-to-end encryption.

Improve Security and User Experience for Your SaaS Apps Using Infisign

With proper action plans in place for these practices, businesses can enjoy the benefits of SaaS tools or platforms while minimizing potential threats.

Infisign transforms how SaaS apps manage security and user experience by combining adaptive authentication with easy access control. 

With MFA, ABAC protocols, and brute force data protection without compromising usability Infisign is a no-brainer solution. Want to know more about how Infisign? Why not try our free trial?