In a bank, every operation, from a customer signing in to an employee changing a limit, starts with one question: who is really on the other side, and what are they allowed to do. That is why identity and authentication stopped being a “login” layer and became the foundation the rest of security rests on. For a security director, it means banking IAM is a board topic, not just an IT one.
In our experience, the hard part is not standing up an IAM tool but wiring it into dozens of existing bank systems without breaking services or leaving gaps in the audit trail. So we treat these projects as development of critical software, with a team that understands both security and the reality of banking architecture. That is exactly the kind of team that has been developing, since 2017, the security systems and digital platforms of a global private bank.
Why are identity and authentication the core of a bank’s security?
Because almost every serious incident starts with a stolen identity, not with broken encryption. Once someone impersonates a customer or an employee, the rest of the controls start working in their favour. A well-designed identity layer flips that around: it narrows what an attacker can do even after taking over a single account.
For a bank, the stakes are not only financial loss but also customer trust and accountability to the regulator. So we treat identity as a layer that has to be tight, reproducible in an audit, and bearable in daily use at the same time. When any one of those three dimensions slips, the other two eventually suffer too.
What is identity management (IAM) in a bank?
Put simply: IAM answers who can access what, and under what conditions, across the whole lifecycle of an account. It is not a single tool but a coherent set of processes and mechanisms. In practice it spans several areas:
- customer identity (CIAM), meaning registration, sign-in and account recovery across digital channels,
- employee and partner identity, from day one of work to revoking access when someone leaves,
- access and role governance, which decides what each person can actually do in a system,
- technical identities, meaning service accounts, APIs and integrations, often the most neglected ones.
We tie these areas together so they form one coherent access story, rather than a set of separate login islands in every system.
What is strong authentication (SCA, MFA), and what does PSD2 require?
Strong authentication relies on combining at least two independent factors from different categories: something the user knows (a password, a PIN), something they have (a phone, a token), and something they are (biometrics). That is what sits behind the acronyms MFA (multi-factor authentication) and SCA (strong customer authentication).
In Europe this is no longer a matter of goodwill. The PSD2 directive obliges banks to apply SCA when customers log in to online accounts and when they initiate payments, with some exemptions for low-risk transactions. We design these mechanisms to meet that requirement without turning every action into an obstacle course. The key here is dynamic linking of the authentication to a specific payment amount and payee, because that is what genuinely makes transaction tampering harder.
How do you govern access and permissions in a bank?
This is where the biggest risk usually hides, because permissions tend to “pile up” over time. An employee moves teams, picks up new roles, and the old ones stay. We clean this up by basing access on clear principles:
- the least privilege needed instead of access granted “just in case”,
- roles and groups tied to a position, not to a single individual,
- separation of duties, so no one person controls an entire sensitive process,
- regular reviews and recertification of access, with automatic expiry of what goes unused.
On top of that, we add stricter control for privileged accounts (administrators, service accounts), because those are the most valuable target. Well-structured permissions mean that even a successful break-in to one account does not open the whole bank to an attacker.
How do you wire IAM into a bank’s existing systems?
This is usually the hardest and least visible part of the project. A bank does not start from scratch; it has core systems, online banking, mobile apps and dozens of internal applications, often with their own login mechanisms. Our goal is a single, coherent source of truth about identity that these systems connect to.
We integrate them with modern standards such as OAuth 2.0, OpenID Connect and SAML, and introduce single sign-on (SSO) where it makes sense. Older applications that do not speak that language we wrap in intermediary layers rather than rewriting them straight away. That keeps the migration gradual and reversible, rather than a risky switch-everything-over-one-weekend.
How do you ensure compliance and audit in the identity area?
For a bank, being secure is not enough; you also have to be able to prove it. So we design for audit from the start, instead of bolting on event logging at the end. In practice that means a complete, non-repudiable audit trail showing who accessed what and when, and who granted them that access.
We map the mechanisms onto concrete requirements, from PSD2 and supervisory guidelines to the bank’s internal policies, so that in an inspection the answer is a matter of running a report, not of digging through logs for weeks. With personal data we stick to the principles of minimisation and accountability, because in a bank identity and privacy always travel together.
Which skills do we provide for an IAM project?
We shape the team around the specific stage and architecture, not “just in case”. On identity and security projects we most often staff roles such as:
- a security / IAM architect who defines the identity and permissions model,
- integration engineers connecting IAM to core systems and digital channels,
- backend developers building authentication services, APIs and SCA mechanisms,
- DevOps and security specialists owning deployments, hardening and monitoring.
Such a team can take ownership of the whole area, from design to maintenance, or reinforce the bank’s own team exactly where hands or expertise are missing.
How do we do it at RITS?
We do it as a nearshore partner from Poland, with real experience working on a bank’s critical systems. For a leading global private banking and asset management institution we have, since 2017, been developing its security systems as well as internal systems and digital platforms, and our engaged team has grown to nearly 90 specialists. We treat identity management and strong authentication as one area within that security competence, not as a standalone tool.
On these projects we lean on a few things: we verify skills before the start, we work in a close time zone, so we join code reviews and meetings without a long ramp-up, and we build with audit in mind from day one. Most often we do this as custom software built by our team and, where the bank needs to top up skills fast, as team augmentation.
Where to start with IAM and strong authentication?
Start with an honest inventory: what identities, systems and login methods you have today, and where the biggest gaps are against PSD2 and your internal policies. Then pick one channel or one high-risk process (for example login and payments in online banking) and prove the target model there, instead of rebuilding everything at once. That defines the architecture, the standards and the roles you need. We covered the differences between engagement models in our article on IT engagement models.
Implementing or cleaning up IAM and strong authentication in your bank? Let’s talk - we’ll match a team and an architecture to your environment and regulatory requirements.
Implement IAM and strong authentication in your bank with us