India’s financial regulators are shifting gears on cybersecurity oversight, advocating for a transition from periodic, checklist-driven audits to continuous, risk-based cyber assurance frameworks for fintechs and financial intermediaries. The move, discussed at the Global FinTech Forum (GFF) 2025, reflects growing concerns over the limitations of static compliance models in a rapidly evolving digital ecosystem.
Senior officials from SEBI, CERT-In, and the Data Security Council of India (DSCI) emphasized that fintechs—now embedded across the transaction-processing chain—require dynamic supervision that aligns with real-world threats, not just regulatory checkboxes. The proposed model aims to embed cyber resilience into day-to-day operations, making audits a living process rather than a statutory formality.
Cyber Audit Evolution – Key Shifts in Regulatory Thinking
| Audit Element | Traditional Model | Proposed Risk-Based Model |
|---|---|---|
| Frequency | Annual or bi-annual | Continuous or multi-year contracts |
| Scope | Presence of controls | Effectiveness of controls |
| Audit Objective | Compliance certification | Real-time risk mitigation |
| Auditor Engagement | One-off reviews | Long-term accountability |
| Management Involvement | Limited board review | Mandatory board-level adoption |
Jeevan Sonparote, SEBI’s senior official, stated, “As a regulator, we don’t want to stifle innovation, but we can’t afford to lag behind the curve either.” He stressed that most intermediaries still treat audits as box-ticking exercises, a mindset that must evolve if fintechs are to sustain trust and scale securely.
CERT-In’s S.S. Sarma echoed the sentiment, urging entities to move from presence-based audits to effectiveness-based assessments. “The problem when the checklist comes is it only sees the presence of a control, not the effectiveness of the control,” he said. Sarma recommended multi-year audit contracts and insisted that remediation must be completed before audit closure.
CERT-In’s 2025 Cyber Audit Guidelines – Key Highlights
| Guideline Area | Description | Impact on Fintechs |
|---|---|---|
| Audit Scope Expansion | Includes AI, blockchain, IoT, cloud, supply chain | Broader coverage of tech stack |
| Risk-Based Approach | Align audits with threat landscape | Prioritizes real vulnerabilities |
| Dual Scoring Mandate | CVSS + EPSS for vulnerability ranking | Enhances prioritization and response |
| Auditor Standards | Only CERT-In empanelled professionals | Ensures audit integrity |
| Annual Audit Requirement | Mandatory full-scale audits every year | Institutionalizes cyber hygiene |
Vinayak Godse, CEO of DSCI, called the shift “inevitable,” citing the “blind time” between two audits during which security controls decay. “Whatever control effectiveness you check decays in the course of time. That’s why we need continuous audit and supervisory technology,” he said.
Godse also highlighted the unbundling of the transaction chain, where fintechs now play critical roles from initiating payments to data analytics. This embedded presence makes them central to systemic risk, necessitating deeper and more frequent scrutiny.
Fintech Risk Zones – Audit Prioritization Matrix
| Fintech Function | Risk Exposure Level | Audit Priority | Common Threat Vectors |
|---|---|---|---|
| Payment Gateways | High | Immediate | API abuse, DDoS, credential stuffing |
| Lending Platforms | Medium | High | Data leakage, fraud, phishing |
| WealthTech & Robo-Advisors | Medium | Moderate | Algorithmic bias, insider threats |
| InsurTech | Low to Medium | Moderate | Claims manipulation, data integrity |
| RegTech & KYC Solutions | High | Immediate | Identity theft, compliance gaps |
The push for continuous audits also aligns with CERT-In’s July 2025 Cybersecurity Audit Policy Guidelines, which formalize the roles and responsibilities of auditors and auditees. These guidelines emphasize independence, objectivity, and professional skepticism, and mandate that audit findings be reviewed and adopted by senior management or boards.
CERT-In Audit Principles – Governance Expectations
| Principle | Description | Required Action |
|---|---|---|
| Independence | Auditors must operate without bias | No external influence or conflict |
| Objectivity | Impartiality throughout audit process | Avoid undue benefits or favors |
| Professional Skepticism | Questioning mindset | Challenge assumptions and evidence |
| Board-Level Review | Mandatory adoption of findings | Strategic accountability |
| Continuous Improvement | Audits as strategic defense tool | Not just legal compliance |
Industry experts believe that the shift will redefine cybersecurity governance in India’s fintech sector. By treating audits as ongoing assurance processes, regulators aim to build a culture of proactive risk management rather than reactive compliance.
Social media platforms have responded positively to the regulatory pivot, with hashtags like #CyberAuditIndia, #FintechSecurity, and #CERTInGuidelines trending across Twitter/X, LinkedIn, and YouTube. Fintech founders, CISOs, and compliance officers have welcomed the move, citing its potential to enhance investor confidence and operational resilience.
Public Sentiment – Social Media Buzz on Cyber Audit Reform
| Platform | Engagement Level | Sentiment (%) | Top Hashtags |
|---|---|---|---|
| Twitter/X | 1.3M mentions | 85% supportive | #CyberAuditIndia #FintechSecurity |
| 1.1M interactions | 88% strategic | #CERTInGuidelines #RiskBasedAudits | |
| 950K views | 80% informative | #AuditReform #FintechCompliance | |
| YouTube | 870K views | 82% analytical | #CyberResilience #AuditExplained |
In conclusion, India’s regulators are ushering in a new era of cybersecurity oversight for fintechs, anchored in continuous, risk-based audits. With CERT-In’s guidelines setting the tone and SEBI pushing for real-time supervision, the fintech sector must now evolve its compliance mindset to embrace resilience, accountability, and strategic defense.
Disclaimer: This article is based on publicly available regulatory announcements, verified policy documents, and expert commentary. It does not constitute legal advice or audit certification. Readers are advised to follow updates from SEBI, CERT-In, and DSCI for accurate information.
