6 Alarming SaaS Security Risks in 2024 and Ways To Mitigate Them

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These days, companies are relying more on SaaS tools than legacy applications. The widespread use of SaaS has completely changed how organizations operate. According to reports, 80% of companies already use at least one SaaS solution.

SaaS apps are flexible, scalable, and efficient, making work smoother and boosting productivity. But, as you consider adopting SaaS, you must focus on establishing strong security measures right from the start. Even a minor issue can expose your organization's data to security breaches and the rise of shadow IT.

Therefore, you should carefully evaluate the security risks associated with the solution. This proactive approach can help you make informed SaaS purchasing decisions and safeguard your data without compromising your organization's integrity.

This article is for you if you're unaware of the common SaaS security risks. It covers the top six SaaS security risks and practical tips for securing your organization's SaaS stack.

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What is SaaS security?

SaaS security refers to the safety and privacy of data carried by software-as-a-service (SaaS) apps. It encompasses encryption, authentication, and access controls that are crucial as SaaS applications access sensitive customer data. It is your responsibility to monitor, manage, and safeguard them effectively.

So, SaaS security relates to the policies and procedures for safeguarding the data within SaaS solutions. It entails protecting, managing, and monitoring businesses' and customers' sensitive information in the cloud and assuring its availability, integrity, and confidentiality. ‍

What do you mean by SaaS security risks?‍

SaaS security risks are prospective vulnerabilities and threats that might endanger the security of SaaS applications and their data. These risks can arise from various sources.

These include unauthorized access controls, vulnerabilities in the SaaS vendor's infrastructure, unsecured APIs, data breaches, insider threats, and poor user deprovisioning. These factors pose significant risks that impact the organization's security posture and operations.

You must emphasize understanding and mitigating these SaaS security risks to keep your organization secure. Failing to take necessary action could result in compliance breaches, lawsuits, and reputational damage.

Check this table to understand the security risks associated with using SaaS and their consequences.

What is the importance of prioritizing SaaS security for organizations?

You can't compromise your organization's security when using any SaaS tools. If you do overlook it, then your organization will encounter the following issues:

Security of sensitive data: SaaS platforms often store sensitive information such as customer data, financial records, and intellectual property. Prioritizing security ensures that this data is protected from unauthorized access, breaches, and cyber threats.

Operational continuity: Security breaches can potentially disrupt existing operations, leading to downtime, loss of productivity, and financial setbacks. By prioritizing SaaS security and implementing necessary measures, you can maintain your organization’s operational continuity and minimize the risk of interruptions to business processes.

Preserving reputation: A security breach can severely damage an organization's reputation and erode customer, partner, and stakeholder trust. Prioritizing SaaS security helps maintain trust by demonstrating a commitment to protecting sensitive information and ensuring the integrity of business operations.

Regulatory compliance: Many industries are subject to strict regulations protecting sensitive data, such as GDPR, SOC 2, PCI DSS, ISO, and HIPAA standards. Prioritizing SaaS security helps organizations ensure compliance with these regulations, avoiding legal penalties and regulatory fines.

Financial resilience: A security breach can cost a lot of money, including fixing the issue, legal fees, and fines. Making SaaS security a priority helps organizations reduce these financial risks and strengthen their defense against cyber threats.

Common SaaS Security risks that organizations should be aware of

As SaaS usage continues to soar in 2024, it's crucial to understand the top security risks. From unauthorized access to insider threats, here are seven common SaaS security risks you need to know to keep your SaaS stack safe.

1. Unauthorized access & insider threats

Unauthorized SaaS access is one of the most common security risks. According to statistics, 36% of employees retained access to systems after leaving their jobs.

It often happens in companies that lack proper provisioning mechanisms. Manually revoking SaaS access can easily lead to errors, allowing employees to retain access to tools they shouldn't have.

If employees retain access to these tools when they shouldn't, it can lead to various issues, including data breaches, compromised confidentiality, loss of intellectual property, legal violations, and damage to the organization's reputation, known as insider threats.

Businesses using SaaS must understand whether the single entry point to the cloud server can reveal sensitive information. Sharing passwords in unsecured chats and emails and inadequate deprovisioning practices can result in unauthorized individuals and ex-employees retaining access to applications.

This can lead to data breaches, as these individuals can exploit their access to the application and steal data.

Check this table to understand the different unauthorized access methods you should know.

2. Shadow IT

Approximately 80% of staff admit to using SaaS apps on the job without prior permission from their IT department. Shadow IT, or using unapproved software and applications, creates security issues such as a lack of control, data breaches, increased spending, and data loss.

Shadow purchases will increase the use of unauthorized third-party applications purchased without conducting adequate due diligence. Apps may not always comply with the most recent security regulations and compliance standards, putting firms at risk of data breaches and regulatory issues.

Organizations must educate workers on the dangers of using unapproved apps. They must also establish rules and processes to oversee and monitor the use of third-party apps. This table will help you understand the causes of shadow IT, enabling you to know how to stay protected from this risk.

3. Poor compliance and regulation

Organizations must ensure regulatory compliance and certification with safety protocols to maintain robust cybersecurity procedures. Even if your company maintains internal compliance, depending on non-compliant SaaS providers might expose you to non-compliance issues.

The PCI DSS standard, for example, requires enterprises to guarantee that their vendors fulfill specified third-party risk management standards to achieve complete compliance. To reduce this risk, your security team should periodically evaluate SaaS suppliers' compliance with industry standards and laws.

Failure to do so may result in data breaches, significant penalties, and reputational harm to your firm. Prioritizing vendor compliance is critical for keeping your data and processes secure and compliant.

Similarly, SOC 2 outlines data security, availability, processing integrity, confidentiality, and privacy criteria. ISO 27001 offers a complete framework for managing information security systems. These regulations require businesses to ensure that their SaaS providers adhere to industry standards and laws.

4. Misconfiguring the Cloud

According to reports, 43% of organizations have experienced security concerns that can be directly traced back to SaaS misconfigurations.

Cloud systems sometimes have multiple tiers of complexity, which developers build to assure the security and dependability of each application. However, having more layers increases the possibility of misconfiguration difficulties.

When security teams ignore minor vulnerabilities, it can have a significant and long-term impact on the broader infrastructure. Misalignments with security rules provide continuous problems that are difficult to manage and correct.

Furthermore, a lack of understanding of SaaS applications' workings and security requirements poses continuing security threats. Business security teams should proactively implement “SaaS Security Posture Management” (SSPM) to address their concerns. SSPM gives complete control and visibility over the SaaS app stack.

5. Storage and data loss

Sensitive SaaS data has been exposed in about 81% of organizations, highlighting the prevalence of data vulnerabilities and the urgent need for enhanced security measures.

Storing sensitive data in the SaaS landscape raises security issues as enterprises entrust third-party suppliers with data management and protection. Using vendor-owned servers raises the risk of illegal access, data breaches, and other dangers.

Cloud-based data storage is potentially susceptible to data loss or corruption due to connectivity problems, device failures, and disasters. Businesses should evaluate their SaaS storage suppliers carefully to prevent risks. They should choose trusted cloud service providers and use strong data encryption when storing data.

Implementing data backup methods, evaluating retention rules regularly, and focusing on compliance with regulations and laws are critical strategies to prevent data loss while preserving data integrity.

6. Non-compliance

SaaS applications must pass the necessary security audits and regulations for compliance certification. These certifications prove that the application is capable of keeping customer data secure.

Often, third-party SaaS vendors are notorious for falsifying such certifications, and when you use one of their applications, you’re putting your sensitive data at risk. So, it is necessary to stay away from these applications.

However, your employees might purchase such applications (shadow IT) without your knowledge, leading to SaaS security risks. So, it is essential to prevent shadow IT, which would stop your users from purchasing such applications.

Your SaaS security risk management team must be vigilant and scrutinize all vendors to ensure they comply with regulatory standards.

How to mitigate SaaS security risks?

You can mitigate the SaaS security risks and implement strong security measures within the provisions. To do so, various options are available, such as:

Using a SaaS management tool

According to a Resmo study, just 26% of organizations have adopted automation to monitor the security of their SaaS applications.

A SaaS management platform provides visibility into your apps so you can manage usage, monitor access, and enforce security standards. By centralizing administration, you can detect unwanted access or possible vulnerabilities and take immediate action.

A bird' s-eye view of the SaaS portfolio provided by these platforms can help IT teams detect and eliminate shadow IT applications immediately. It’ll also make verifying a vendor’s compliance with security regulations easier for the security team.

For example, you might utilize CloudEagle, an advanced SaaS management and procurement platform. This tool simplifies and centralizes your organization's SaaS management with various features and automated workflows.

With CloudEagle, you can oversee all your SaaS applications through one dashboard. This lets you comprehensively overview your SaaS environment, including usage, expenses, user access, and security.

With CloudEagle's automated workflows, you can automate tasks such as provisioning and deprovisioning, simplify user provisioning, and minimize your IT team's manual workload. This tool removes time-consuming tasks like user provisioning and deprovisioning, potentially saving up to 500 hours per year.

Here's a testimonial from Alice Park at Remediant. She spent a significant amount of time manually provisioning and deprovisioning users across different applications. However, by integrating with CloudEagle's HRIS system, user management was streamlined through automated provisioning and deprovisioning workflows, saving Alice valuable time.

You can use a SaaS management platform like CloudEagle to prevent shadow IT and mitigate the SaaS security concerns of third-party applications. It’ll provide a centralized view of your application portfolio and help your team stay in control of the SaaS stack.

Implementing robust authentication and authorization

According to a study, 82% of employees believe accessing sensitive company information they weren’t authorized to view would be possible. Strong authentication and authorization processes are critical for protecting sensitive data and preventing unwanted access to SaaS apps.

Access controls restrict access to resources, such as SaaS apps, to only authorized users. Strong access restrictions may be implemented in your SaaS system in various ways, including:

Role-based Access Controls (RBAC)

RBAC simplifies access management by tying permissions to user roles, not individual identities. This enhances security by limiting access to only what's necessary, reducing the risk of breaches.

Multi-factor Authentication (MFA)

MFA provides an extra layer of protection by asking users to give other credentials along with their login and password, such as a one-time password or a biometric scan. Proper authorization restrictions guarantee that users only get access to the required features and data for their roles and responsibilities.

Password Guidelines

Password guidelines enforce strong password practices, including complexity and regular changes, to prevent unauthorized access.

Session Time-outs

Session timeouts automatically log users out after inactivity, mitigating risks from unattended devices or shared networks.

If you need a tool to enforce robust authentication and authorization, look no further than CloudEagle in the realm of Identity and Access Management (IAM). CloudEagle stands out with its comprehensive features for managing identities and access, providing a groundbreaking approach to security.

With features such as real-time monitoring, robust authentication, and seamless integration with SSO and HR systems, CloudEagle ensures accuracy and efficiency throughout the identity and access lifecycle. Its automation capabilities, customizable workflows, and user-friendly interfaces empower IT and HR teams, streamlining operations and boosting productivity.

Training your staff on SaaS security concerns

Employee education and awareness are critical in reducing SaaS security risks. To eliminate human error and limit threats, educate your staff on SaaS security best practices, such as strong password management, phishing knowledge, and safe browsing habits.

• Conduct regular workshops on password management, emphasizing the importance of strong passwords and the use of password managers.
• Provide training sessions to help employees recognize phishing attempts and educate them on responding appropriately.
• Offer guidance on safe browsing practices to mitigate the risk of malware infections and data breaches.
• Conduct simulated security incidents to test employees' responses and improve their readiness to handle potential threats.

By cultivating a security-conscious culture and offering regular training, businesses can empower their staff to make educated security choices and avoid acts that could jeopardize data security.

Conducting consistent compliance and regulatory audits

Ensuring SaaS compliance requires an ongoing process. Thus, you should constantly monitor and audit user activity and vendors to mitigate SaaS security risks. These audits assist businesses in identifying redundancies in their security measures. Furthermore, monitoring and auditing user actions helps detect unwanted access, suspicious activity, and data exfiltration.

Security teams must frequently monitor and assess their SaaS providers' compliance with industry standards to identify any SaaS cloud security vulnerabilities that must be addressed.

Also, thoroughly checking vendors is crucial. Knowing their compliance practices well is key, as any issues could cause problems for your organization. Organizations can confidently handle compliance and lower compliance-related risks by paying attention to these aspects.

Conducting thorough risk assessment and due diligence

Before implementing a SaaS application, it is necessary to perform a complete risk assessment. Consider the possible SaaS security concerns connected with the SaaS application, such as data handling procedures, encryption mechanisms, vulnerability management processes, and troubleshooting SSL errors.

SSL (Secure Socket Layer) errors can occur for multiple reasons, including a mismatch of domain names, outdated SSL certificates, and an untrusted Certificate Authority. These can hinder a web server and browser's ability to establish a secure connection, leading to potential risks for data security.

Conduct due diligence on the SaaS vendor. Learn about their security handling capabilities, compliance, incident response abilities, and data protection measures, including their ease in managing and troubleshooting SSL errors. This thorough assessment gives enterprises the information they need to make informed decisions.

They can select SaaS providers who satisfy their security standards, thus reducing the risk of security breaches or data exposures.

Maintaining a SaaS security checklist

Creating a detailed SaaS security checklist tailored to your organization's SaaS usage helps guarantee that security policies are consistently implemented. The checklist must include data encryption, frequent backups, safe API integrations, incident response methods, and staff security awareness programs.

You must also ensure that sufficient tools are available to meet the requirements laid out in your checklist. Having an essential API security scanner available is a good example. Review and update the checklist regularly to keep up with developing security best practices and emerging risks.

To assess security risks in your organization and optimize Shadow IT for increased ROI, listen to Joshua Peskay, 3CPO (CIO, CISO, and CPO) at RoundTable Technology. He discusses managing Shadow IT and introduces an ROI scoring system for SaaS tools to optimize technology investments.

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Conclusion

SaaS security risks, including data breaches, insider threats, and compliance challenges, are a major concern. To ensure safety, prioritize strong security measures, train your team, and adhere to regulations.

However, robust SaaS security solutions can help businesses safeguard critical data by ensuring proper access controls, user provisioning, and application visibility.

If you need assistance selecting the right tool to enhance your organization’s SaaS stack, we recommend CloudEagle, a comprehensive SaaS management and procurement platform with robust security management features.

If you need assistance implementing a SaaS governance framework, consider scheduling a demo with CloudEagle.

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Frequently asked questions

1. Why is SaaS security important for businesses?

SaaS security is critical for businesses to protect sensitive data, maintain regulatory compliance, and retain their brand. It safeguards against unauthorized access, data breaches, and other security risks. It also keeps the confidentiality and reliability of cloud-stored information intact, thus boosting stakeholder trust.

2. What should you look for in SaaS security Checklist?

A SaaS Security Checklist should focus on existing security rules, level of compliance, employee authentication methods, data encryption and tokenization, and automatic backups.

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