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10 SaaS Security Risks And Concerns Every User Has

Category: B2B News

In the past couple of years, SaaS (Software as a Service) has become a staple for many businesses around the world. It presents not only a step forward for the digital age and sharing data, but also as one of the signs that companies are willing to keep up with the latest tech. For customers, that small detail could be potentially invaluable. It’s a step into the future, one that users either accept or will eventually need to come to peace with the loss of CDs, DVDs, and external drives.


To this day, SaaS are considered to have several advantages for business managers and make life easier for users. However, the technology can still be considered relatively new. While a majority of companies are using them, there are still concerns, risks, and misconceptions regarding their services. It’s mainly because using SaaS often implies not relying on an internal IT department for data storage. And that, in essence, can be a source of worry.

1. Data Access Risk

Because they are giving their information and data to a third party, numerous users are concerned about who gets access. It may seem out of their control and fear the potential dissemination, deletion, or corruption of their data by unauthorized people. It’s a particular major worry for users who plan on storing sensitive data that will be detrimental if it ends up in the hands of others, especially their competition.

However, every customer can review and discuss the policies and procedures that are implemented by the SaaS provider. You can define the level of access and to whom you grant it. All providers are required to include that condition in the Terms of Agreement, but make sure to check before signing so that you can spare yourself later worries. In fact, be wary of the kind of privacy questions you should ask SaaS providers and do not hesitate to inform yourself well on the technical side of the matter.

2. Instability

Security and stability are the true pillars that hold up a reliable SaaS software. The services are becoming increasingly popular, which is a double-edged sword. On one hand, it means more options for users and high-quality services because it forces every single provider to keep up with the competition. On the other hand, not everyone will be able to keep up with the growing market. And, in the end, employed provider might get shut down because they can no longer compete.

Data portability can be a hassle from that point on. It’s a major concern on what would happen because it means that all the time and money invested in a service is going down the drain. Unfortunately, it’s a risk you will have to take. The situation can be unpredictable. What will happen to all that data now that the SaaS provider went out of business? It may not be as dramatic as a complete shutdown of the service, but you may encounter changes in prices or security policy.

To alleviate your worries, make sure you read the policy careful regarding these issues before you are confronted with a potential data leak due to their protection services being no longer active.

3. Lack of Transparency

SaaS providers are often secretive and assure their clients that they are better are keeping their data safe than any other out there. At the very least, they guarantee that they will be capable of securing information and files more proficiently than the customer themselves. However, not all users take their word at face value. There are numerous concerns regarding the provider’s lack of transparency on how their entire security protocol is being handled. Unfortunately, this is a matter up for debate.

This lack of transparency may cause distrust from their customers. Both the clients and industry analysts are not getting answers to several security questions. It leaves them with empty spaces and speculations about the service they are employing or reviewing. However, SaaS providers argue that the lack of transparency is what keeps their services secure. Divulging information about data centers or operations might compromise the security of their clients. The argument may appear reasonable for numerous users, but it still leaves others with concerns.

4. Identity Theft

SaaS providers always require payment through credit cards that can be done remotely. It’s a quick and convenient method, but it does concern some users about the potential risk it implies. There are numerous security protocols placed to prevent problems. Identity management can be within the company’s LDAP directions, inside the firm’s firewall, or on the SaaS provider’s site. It may depend. It’s also severely flawed because this process is still in its infancy. Providers often do not have a better solution for identity management than the company’s own firewall.

Identity theft then becomes a major concern that is often prevented only with the use of numerous security tools. That implies using an additional software and perhaps payment of services that guarantee the safety of your credit card information. It’s an issue that stems from managing access, which is famously easy for SaaS, and the fact that the strategy may change through time. That can often result in concerns, especially for first-time users who have not properly researched the provider before payment. Here is one very advanced article on how to avoid identity theft. It has more than 100 advanced tips on that topic.

5. Uncertainty of Your Data’s Location

Most SaaS providers do not disclose where their data centers are, so customers are not aware where it’s actually stored. At the same time, they must also be aware of the regulations placed by the Federal Information Security Management Act (FISMA) which states that customers need to keep sensitive data within the country. That means that you might or might not have access to your data if you’re flying out of the U.S. or you might have other options.

Should you travel outside of the country, your SaaS provider, especially with cloud-based software, will notify you that your information has been sent to another one of their centers (in Europe for example). That means that your sensitive data is being transferred for your own convenience and access, but at the same time, it leaves users to wonder where it is exactly. Some, such as Symantec, offer their services in over a dozen countries, but it’s not a guarantee from every provider. You may not know where your valuable data is at a given time.

6. Paying Upfront and Long-Term

Financial security is also an issue that may be born out of your agreement to use a SaaS provider. A good majority of them require payment upfront and for long-term. That’s even if you are unsure of how long you will need their service or if something in their policy will change through time.  It’s a concern of investing in a potentially crucial part of the company that might not be up to par and dissatisfy you as a customer. Some might even force you to pay a year ahead.

Once the payment is made, your funds have been taken, and you have the service at hand. However, that does not provide all customers with security. The service will surely remain, as settled by contract, but the quality and security might change. There are worries that users might end up with an application that no longer updates itself, which can affect both its use and safety. If the encryption is not kept up to date, you may open yourself to several security issues, and your data could be compromised. It’s a detail to be checked before paying the provider.

7. Not Sure What You Agreed To

Every business is required to provide terms and conditions where they explain, in scrutinizing detail, the nuances of how their service works. However, not everyone bothers to read the lengthy document that is typically standard. Even more, not all are IT aficionados with expertise in the slang commonly used for that niche. That might have them end up to agreeing with certain things they do not properly understand. And then when problems arise, most customers are not quite sure what exactly they agreed upon when signing.

The ideal situation would be to have someone familiar with the SaaS service check the Terms and Conditions document in order to familiarize you with the basics and details. Or, have separate departments read different sections that might affect their activity. It’s the safest way you will not have worries later on regarding what you signed up for and what awaits in the case of issues.

8. How Your Data is Actually Secured

Customers should always know where and how their data is secured, but some explanations might not be precisely understood. Not everyone knows and understands encryption protocols or what it all means. Clients can be worried regarding certain aspects of the tech part, such as how their data can be recovered or restored regarding issues.  The very existence of restoring capabilities naturally implies that there are servers out there who are storing your sensitive data and keeping it safe. But how safe?

SaaS providers have to make sure that their customers are well informed through their Privacy Policy about how it all works. Even more, they should offer a standardized form on how they handle disaster recovery in case their servers get shut down by an outage or natural phenomenon that might cause damage. Clients may, unfortunately, have no guarantees that it will be possible, and it is certainly a worry that sensitive data may be lost forever.

9. No Direct Control Over Your Own Data

Along with concerns that the SaaS provider’s servers could shut down for good, there are risks and worries regarding the fact that your data is not really in your control. The good side is that you don’t have to configure, manage, maintain, or upgrade the software. The downside of that is that you essentially lose some control over your data. For example, should something happen and your data is lost, you will have to contact the service provider, wait for their answer no matter long that takes, and only then get an answer of what might’ve happened.

It all depends on the level of customizability the provider offers which, again, may be limited. The SaaS provider is in charge of the responsibilities concerning data storage. That may be a relief, but it’s also a loss of control to a certain degree that opens users to worries and, in some cases, costs them a lot of time waiting for answers when faced with issues.

10. The Service May Not Keep Up with Modern Security Standards

Plenty of providers boast of their security credentials and prove to their users that they have excellent control over their data and security. However, most will speak of standards that are not up to date, and it does say quite a lot about how mature the service really is. It offers the possibility that while the data may be safe now, it might not be in a year or two when protocols have changed, policies have been updated, and risks have heightened.

And, as mentioned above, most providers insist on a long-term investment in their SaaS software. You need to make sure that your provider stays up to the with security measures in order to alleviate this particular worry. However, you may rest assured that many of them need to maintain their software updated and their servers maintained. Otherwise, they wouldn’t be able to keep up with their competition.

SaaS is always an excellent option, but there are pitfalls to the practice that haven’t been fixed yet. It leaves several users worried and possibly reluctant to continue with the subscription. However, they can all be eliminated if you tread carefully, pay attention, and treat it with the utmost care.

By Nestor Gilbert

Senior writer for FinancesOnline. If he is not writing about the booming SaaS and B2B industry, with special focus on developments in CRM and business intelligence software spaces, he is editing manuscripts for aspiring and veteran authors. He has compiled years of experience editing book titles and writing for popular marketing and technical publications.

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