Navigating SaaS Compliance

This page was updated February 2026.

Key Takeaways

• SaaS compliance covers several frameworks, which vary based on goals and markets served. They include SOC 2, ISO 27001, GDPR, and emerging AI compliance standards.
• Compliance certifications can accelerate sales cycles by up 60% while unlocking access to enterprise markets that require verified security attestations.
• The cost of non-compliance can lead to millions in regulatory penalties, with GDPR fines up to €20 million or 4% of annual revenue.
• Modern SaaS companies need to account for new AI governance frameworks like ISO 42001 and the EU AI Act.
• Strategic compliance management through expert partners can reduce time-to-audit from months to weeks.

SaaS regulations are in place to help your business adhere to the latest data usage and privacy laws.

You’ll need to meet and understand the latest SaaS compliance guidelines to serve your clients with integrity and security. To achieve this goal, it’s important to find a balance of data privacy, internal training and monitoring, and recognition of and response to potential incidents.

Software as a service is an increasingly more prominent and lucrative industry. What is the compliance for SaaS? In the early days, SaaS regulations were limited in this sales area. Regulatory bodies hadn’t yet considered the deeper societal implications, especially regarding cybersecurity concerns. Over the years, increasing regulations have required SaaS companies to remember more when running their businesses. Saas regulations went from a nice-to-have to a must-have.

Compliance impacts a wide range of protocols. This guide focuses on cybersecurity, data, and privacy implications when it comes to navigating SaaS regulations. It is important to recognize that financial compliance, personal data privacy, and other compliance measures operate beyond cyber-compliance.

All these requirements can feel exhaustive and overwhelming. As you grasp these standards, you’ll find that handling these requirements isn’t as overwhelming as you might think. At Trava, we want to help you navigate all the nuances of SaaS compliance. This guide helps you understand SaaS compliance requirements. Find helpful resources and learn how to integrate these requirements confidently.

What Is Compliance, and Why Is it Important?

As in any business, there are certain regulations and procedures that you must follow to have a secure business that can meet predetermined standards of data protection and security. The regulations may look slightly different depending on your specific industry and location. For instance, medical software, such as that used for telehealth, requires a different level of compliance with regulations like the Health Insurance Portability and Accountability Act of 1996 (HIPAA), which creates stricter requirements around private medical data.

To stay on the right side of the law, it’s crucial to be familiar with state, federal, and international regulations. Skipping compliance might seem tempting, but the repercussions can be severe, including hefty fines, penalties from regulatory bodies, or lawsuits from customers whose data is compromised due to a company’s negligence. While some compliance measures aren’t strictly mandated by law, adhering to them is still advisable for maintaining trust and integrity.

Data breaches and cyberattacks are an increasing threat; you don’t want to be open to those attacks. Not only do you face legal issues when you don’t comply and something terrible happens, but you may also lose customers’ trust or lose vital working time and income due to costly cyberattacks, which amount to $10.5 trillion in costs around the world by 2025.

Although compliance can cost money, the price you pay is the price you pay is typically a small sum compared to what you stand to lose without these measures. For example, the SOC 2 compliance cost can be thousands of dollars of investment, but you stand to lose hundreds of thousands of dollars if you don’t hold yourself to this high-security standard. For many businesses, the cost of certification is worth the investment, but each business must determine its individual compliance needs, as not all types of compliance are necessary or wanted for every business.

What Is Compliance in SaaS?

Compliance for SaaS requires companies to look at the range of security and privacy parameters used worldwide and in different industries to ensure companies are protecting their customers’ data. SaaS compliance is not that different from the compliance that any other business faces. Most of the concerns other businesses have are the same as those with SaaS companies.

However, SaaS companies have some special features to consider. These companies tend to have more cybersecurity concerns since they often rely overwhelmingly on cyberspaces. They also often operate in more jurisdictions, meaning they don’t have to only pay attention to local or state-to-state procedures and must comply with global safety standards, such as the GDPR.

What Does it Mean to Maintain Compliance?

It’s natural for companies to want to be secure, and companies can use many measures and procedures to ensure their security. Compliance often links to security, but there are differences between security and compliance. Both can be in harmony to help any business protect themselves. There are varying levels of security protocols, and some may fall short of compliance requirements, while others may exceed regulatory standards.

While security focuses on understanding, mitigating, and transferring risk, compliance is about more than just risk or certain rules. To be compliant, your business has to meet the standards of a regulatory body that has established a certain level of standards that guarantees you are obeying the presiding principles of that agency. Different bodies often have overlapping regulations, but each one will specify its own parameters. Standards often evolve over time, so compliance is often a dynamic process. Businesses cannot just reach compliance. They must also maintain it.

Compliance requires you to not only have security measures as listed but must also pass an audit or be certified to verify that you are actually abiding by the agency’s principles. Most organizations will give certifications, assuming you pass their standards. They will also have audits to ensure you continue to meet standards. Compliance gives an added level of confidence in your security because companies can make whatever claims they want, so having an official body verify that those claims are true adds transparency and trustworthiness.

Do I Need a SaaS Compliance Checklist?

The short answer is yes. A SaaS compliance checklist is your guide through global regulations. It helps you avoid fines, pass vendor security reviews, and gain trust with your clients.

Without a structured approach, it is easy to miss critical security gaps that could lead to a breach or a failed audit. Follow this simple SaaS compliance checklist to get you started.

Phase 1: Strategy and Scoping

You must define the legal and regulatory landscape your business operates in.

• Identify Applicable Frameworks: Determine if you need SOC 2, HIPAA, PCI DSS, or GDPR.
• Data Mapping: Document what data you collect, where it is stored, and who has access to it.
• Establish a Compliance Team: Appoint a leader (or partner with a vCISO) to oversee the roadmap and coordinate between IT, legal, and executive departments.

Phase 2: Technical Security Controls

These are the “locks on the door” that protect your application and cloud infrastructure from exploitation.

• Access Control & Identity Management: Use Multi-Factor Authentication (MFA) and Single Sign-On (SSO) to stop unauthorized access.
• Encryption Protocols: Ensure that you encrypt all sensitive data both “at rest” (in storage) and “in transit” (moving across the internet).
• Vulnerability Management: Regularly assess cybersecurity risks and run automated scans. This helps find and fix software gaps.
• Network Security: Protect your data centers, routers, and cloud instances. Use well-configured firewalls and intrusion detection systems.

Phase 3: Operational Readiness and Auditing

Compliance requires proof. This phase focuses on the documentation and testing required to pass an official audit.

• Draft Security Policies: Create a formal “Security Policy” that outlines your company’s rules for data handling, incident response, and employee behavior.
• Vendor Risk Management: Verify that your third-party sub-processors (like AWS, Azure, or Stripe) hold their own valid compliance certifications.
• Incident Response Planning: Develop and test a “break-glass” plan so your team knows exactly how to detect, respond to, and recover from a breach.
• Perform a Readiness Assessment: Before paying for a formal audit, conduct a compliance self-assessment to identify any remaining gaps in your controls.

What Is the Requirement of SaaS to Provide Security?

As a SaaS company, navigating the ever-changing landscape of legal requirements and industry SaaS regulations can feel overwhelming. However, prioritizing compliance is crucial for maintaining operational integrity, building customer trust, and avoiding legal trouble.

SaaS requirements are often where many businesses want to begin to make sure they don’t get into legal trouble. Like any other business, companies focused on Software as a Service not only have to be aware of current SaaS regulations, but they also have to be aware of emerging regulations that can impact their business. Using a compliance readiness roadmap, you can start tracking your compliance journey and keeping up with the trends.

Key Compliance Considerations:

• Stay Informed: Legal requirements vary across regions and industries. Familiarize yourself with major regulations like HIPAA for healthcare, Payment Card Industry Data Security Standard (PCI DSS) for payment processing, and the General Data Protection Regulation (GDPR) for data protection in the European Union. Additionally, keep an eye on emerging global standards like the GDPR to stay ahead of the curve.
• Track Your Progress: Utilize a compliance roadmap to track your progress towards meeting all applicable regulations. This roadmap should be regularly reviewed and updated to reflect changes in the regulatory landscape.
• Know Your Market: Don’t assume a one-size-fits-all approach. Analyze the specific legal requirements for your industry and target markets. Focus on prominent markets where you operate or plan to operate, and pay attention to emerging state data privacy laws that might apply.

Data Protection in the Spotlight:

Data protection laws are becoming increasingly common, with many countries already implementing their regulations. Complying with these laws, such as the GDPR and emerging state regulations, is essential for protecting customer data and building trust.

Industry-Specific Concerns:

Remember, certain industries have specific privacy regulations. For instance, healthcare providers must comply with HIPAA, while payment processors adhere to PCI DSS. Be sure to understand any special concerns relevant to your industry when working towards compliance.

Proactive Measures are Key:

Don’t wait for regulations to catch up with you. Staying informed about changes and maintaining robust security standards is crucial. This proactive approach not only protects your customers’ data but also helps avoid potential legal issues and fines. By keeping up with the latest security protocols, you’ll be well-equipped to juggle the complexities of global security standards effectively.

Who Regulates SaaS Compliance?

There are different regulatory bodies, and all of them seem to have confusing acronyms and names—CCPA, CMMC, GDPR, NIST, FedRamp, ISO 27001, SOC 2, HIPAA, and IFRS, just to name a few.

Unfortunately, when it comes to the regulation of SaaS compliance, nothing is simple. You’ll quickly notice that there is no single SaaS regulation audit checklist because not just one regulatory body verifies compliance. Thus, to know what steps you need to take for your SaaS company, you need to understand the players who regulate SaaS and the differences between them.

To make it easy, use the following SaaS audit checklist to learn more about the different regulatory groups you will need to consider when implementing SaaS regulatory requirements, especially security laws, frameworks, and certificates.

• GDPR: The European Union passed the General Data Protection Regulation in 2018. This is a regulation to protect personal data and promote data privacy. Those who want to operate in the EU must pay attention to these regulations.
• CCPA: If you want to operate in California, keeping the California Consumer Privacy Act in mind is important.
• CPRA: The California Privacy Rights Act is another example of California law that adds to the already established privacy laws. When you have customers in California, you have to consider these laws. Other states have similar laws, but California tends to have greater regulations when it comes to data protection.
• NIST: The National Institute of Standards and Technology is a security framework focusing on key security areas to help prevent and effectively address cyberattacks. This is to join the private and public sectors to create better security infrastructures and procedures. It promotes five steps: identify, protect, detect, respond, and recover.
• CMMC: The Cybersecurity Maturity Model offers a certification that is geared toward challenges in the defense industry, so it is also geared toward companies that work with the Defense Industrial Base.
• FedRamp: FedRamp compliance, also known as the Federal Risk and Authorization Management Program, offers a security framework designed for the federal government.
• SOC 2: SOC 2 is a popular security framework that stands for System and Organization Controls. It uses Trust services criteria to deal with a company’s infrastructure, data, people, software, and risk management policies.
• ISO 27001: ISO 27001 is one of the most prominent of all security standards and often proves that a company has the highest level of security standards. This process is usually expensive but may be worth the investment.
• PCI DSS: Payment Card Industry Data Security Standard includes security frameworks that are for companies that use credit card information, and this protocol focuses on dealing with credit card information safely.
• IFRS compliance, also known as the International Financial Reporting Standards, has standards for 168 jurisdictions and is a financial framework that seeks consistent and transparent financial reporting.
• GAAP: Generally Accepted Accounting Principles refer to accounting standards that ensure appropriate financial reporting.
• HIPAA: HIPAA compliance is used in healthcare, and it was created to protect the privacy of patients. It is most often used in software that is used by healthcare professionals, including telehealth platforms.
• AI Compliance: Artificial intelligence is becoming more integral to SaaS apps, and new regulatory frameworks are emerging to govern it. Companies should consider ISO 42001 and the NIST AI Risk Management Framework. EU businesses also need to comply with the EU AI Act, which has transparency obligations and human oversight requirements.

You likely don’t need to comply with all these standards, but you will may need to comply with several of the above standards. You’ll want to start by identifying the SaaS regulations and standards that you are legally required to meet. Once you are sure you’ve met those standards, you can expand to cover other relevant risks that add trust and security to your company but aren’t strictly required.

Which Compliance Frameworks Are Non-Negotiable for Modern SaaS?

SOC 2 and ISO 27001 are foundational frameworks for SaaS security. But you may also need to consider other frameworks depending on the customers and markets you serve, among other factors.

AI Compliance

AI compliance has become urgent as companies rush to deploy machine learning models and automated decision-making systems. SaaS companies navigating AI compliance challenges should focus on data governance for training sets, model monitoring to detect bias and drift, and documentation.

The EU AI Act classifies AI systems by their level of risk, imposing stricter requirements on higher-risk applications. ISO 42001 provides a management system framework designed exclusively for AI governance, which is worth reviewing.

Understanding regulatory compliance AI frameworks isn’t always easy. So, if you’d like support, Trava offersAI risk management services that can guide you through each step in the implementation process.

GDPR

The EU’s GDPR legislation controls how organizations handle personal data. Even if your business is outside of the EU, you’ll need to follow these requirements if you process the data of EU residents. For SaaS companies, that means documenting:

• The type of data you collect
• Your legal basis for processing it
• Retention periods
• Who you share the data with, if anyone

The legislation also gives individuals rights. For example, it says that users must be able to access their data, request deletion, and restrict processing based on their preferences. If you can’t meet these requirements within the GDPR’s timelines, the penalties can be severe — up to €20 million or 4% of annual global revenue, whichever is higher.

PCI DSS

All SaaS platforms that accept, process, store, or transmit credit card data also need to comply with PCI DSS. Many SaaS companies meet these compliance requirements by using payment processors like Stripe and PayPal.

CMMC

The Cybersecurity Maturity Model Certification (CMMC) has become mandatory for SaaS companies serving defense contractors. The framework is split into three maturity levels, with Level 2 requiring 100 practices aligned with NIST SP 800-171. CMMC often requires third-party assessment by certified vendors.

What to Look for in SaaS Security

Your SaaS security measures will vary depending on your industry and your company’s individual needs and priorities. When you’re looking for the right security measures for you, you have to consider the most prominent concerns you have based on the uniqueness of your company. For example, if you work in healthcare, HIPAA concerns are crucial. Determine what priorities you have, and don’t just think about right now. If you plan to expand your company into Europe, for instance, you’ll want to start ensuring you comply with European requirements now.

Once you have identified different risks and needs, you can create goals that will help you cover any risks and fulfill any needs. From there, you can start to create a plan that enables you to reach your compliance goals. With your goals in mind and your plan developed, you’re ready to implement your initiatives and get any certifications or audits you may need after the plan is in place.

As you continue, you will have to reassess and continue to monitor your security, looking for and responding to gaps as they emerge. Security measures are always changing, and as cyberattacks become more advanced, so are many security measures.

If all that sounds like a lot to take in, don’t worry. You don’t have to handle these concerns alone. Trava wants to help you understand what security concerns you should pay attention to and how to address them. We’ll help you create a plan that reflects your company’s ambitions and current state.

Trava’s SaaS security checklist NIST uses the NIST framework to help SaaS companies start understanding the different areas that impact their level of security. While this checklist focuses on one protocol, it was chosen because it offers a strong starting point to better understand the role of SaaS security and how to look for security that offers a high standard of protection.

Is SOC 2 Mandatory for SaaS?

For SaaS companies, having a SOC 2 attestation is not a strict requirement, but it is often a de facto requirement. SOC 2, known as Service Organization Control Type 2, is a framework created by the American Institute of Certified Public Accountants to ensure third-party services process and store data responsibly. It has five main tenets, called Trust Services Criteria: security, privacy, processing integrity, availability, and confidentiality. This framework is less rigid than others, and companies can customize how to reach the Trust Services Criteria and pass the audit.

Many companies opt to have SOC 2 compliance for SaaS because SOC 2 is often seen as a gold standard for any service organization, and customers often want to see this level of certification to know their data is protected. This certification also makes companies look more legitimate, allowing businesses to expand more readily. Thus, meeting SOC 2 requirements and succeeding with the audit can be hugely beneficial for companies.

What Companies Need to Be SOC 2 Compliant?

The short answer is that any company that offers services and stores, transmits, or processes data will want to be SOC 2 compliant—however, SOC 2 compliance is not a legal regulation. So, if you do not comply, you will not receive legal ramifications based on non-compliance. However, some companies need to be SOC 2 compliant based on customer demand, stakeholders, or other business pressures. Ultimately, following SaaS regulations will also support SOC 2 compliance.

What Is SOC 2 Compliance vs ISO 27001?

SOC 2 compliance and ISO 27001 are both valid protocols, however, SOC 2 may provide a higher standard of security for your organization. Both certifications can help businesses look more trustworthy and safer, but there are some key differences SaaS companies need to know.

Understanding ISO 27001 for SaaS Companies

ISO 27001 is the international gold standard for information security management. It requires organizations to implement 93 controls across 14 domains (although not all of these are mandatory for every business).

Preparing for an ISO 27001 audit involves creating significant documentation and formalizing security procedures. Companies need to establish that they’ve identified their security risks, implemented controls for them, and created processes for continuous monitoring.

Understanding what to expect during an ISO 27001 audit helps companies prepare effectively. Auditors will want to review your Statement of Applicability, risk treatment plan, and evidence that your controls operate effectively in real-world scenarios.

Key mandatory controls of ISO 27001 include:

• Information security policies
• Asset management
• Access controls
• Cryptography
• Physical security
• Operational security

But these aren’t just boxes you need to check to get your certification. They can bring real value to your bottom line. For example, PureInsights improved its security standards and market presence through ISO 27001 certification and gained competitive advantages in enterprise sales.

Understanding SOC 2 Compliance

The SOC 2 certification is not as stringent because companies have general tenets outlined, but companies are free to implement controls as they see fit rather than having to have a certain number of specific security controls. SOC 2 still requires a high level of general security, but controls are practiced differently than under an ISO 27001 framework.

While more fluid than some other certifications, it helps to know SOC 2 structures so you can appropriately implement this framework. Our SOC 2 compliance checklist uses the key areas that are required for SOC 2 compliance to guide companies to put all necessary measures into place, including:

• Security
• Availability
• Processing Integrity
• Confidentiality
• Privacy

When considering SOC 2, you must remember that SOC 2 refers to two reports: SOC 2 Type 1 and SOC 2 Type 2. Type 1 refers to the design of security controls at just one moment, while Type 2 evaluates effectiveness over a longer period. Generally speaking, organizations prefer Type 2 because they better represent a company’s overall security prospects.

SOC 2 and Iso 27001 can both show off the security of your company, and both standards have their own pros and cons, but many companies find that SOC 2 provides a high standard of overall security while allowing more flexible and customizable controls that fit the nuances of individual companies. You will have to assess your company’s needs and desires before making the appropriate decision for you.

Why Do SaaS Companies Need Compliance Certifications?

Compliance certifications fulfill several roles that directly impact a SaaS company’s bottom line, including:

• Accelerated sales cycles
• Access to enterprise markets
• Resilience and operational maturity
• Competitive differentiation

Enterprise buyers often look for these before committing to new SaaS vendors. Sales cycles that could last up to a year without certifications can close in as little as a few months with them.

Many buyers require compliance with frameworks such as SOC 2 Type II or ISO 27001. If you don’t have these, your business won’t be an option for many enterprise organizations — even if you have better features and pricing than everyone in your sector.

These certifications also help you build a strong reputation for security and avoid costly fines for non-compliance. They can become a point of differentiation as you work to attract new opportunities.

What Is the Security Responsibility of SaaS?

SaaS companies have a responsibility to their customers to protect data and privacy. When customers buy a product, they want to do so knowing that their private information won’t end up in the wrong hands or being used for unanticipated purposes. Beyond just legal requirements, SaaS companies have ethical duties to act in good faith when it comes to their customers’ data. Data breaches and cyberattacks are to happen. However, companies should resist such disasters by having appropriate levels of security, which you can obtain and verify using compliance.

If you want to gain a baseline of your current level of security, you may be interested in taking a SaaS Security Assessment Questionnaire and taking steps to understand how to assess your SaaS security so that you can continue to fulfill your security responsibility.

What Are the Costs of Non-Compliance in SaaS?

Non-compliance is not a realistic option for most SaaS companies today. It would threaten the viability of your business going forward, through financial penalties, operational disruptions, reputational damage, and revenue loss.

For example, non-compliant companies can experience data breaches that accelerate customer churn. This can affect fundraising as investors begin to question management’s judgment.

Non-compliance also creates internal chaos through shadow IT. When official systems are too restrictive, teams often adopt unauthorized tools that share data through unapproved channels, multiplying your attack surface.

There are also many potential fines for non-compliance. HIPAA violations carry penalties up to $1.5 million per violation category annually, and GDPR violations can extend to €20 million or 4% of annual revenue.

Why You Should Hire a SaaS Compliance Management Company

Working toward compliance while running a fast-growing SaaS company isn’t always realistic. Teams have limited resources that need to be allocated where they’re most effective — and that rarely means taking experts out of their fields to work on these issues.

Trava Security offers comprehensive compliance management support, so your team can focus on what it does best. For example, penetration testing for SaaS compliance is a critical control required by SOC 2, ISO 27001, PCI DSS, and HIPAA. We employ ethical hackers to test for vulnerabilities and provide detailed reports on their findings to assess the real-world impact of controls.

Compliance services from Trava transform the journey into a more structured process. Our automation platform manages controls, evidence collection, and audit preparation in a single centralized system. Dedicated compliance advisors conduct gap assessments and guide policy development, while evidence collection automation integrates with your existing tools to gather proof continuously.

We also offer vCISO services, providing experienced security executives on a fractional basis. Your vCISO can develop a security roadmap, oversee your compliance program, and support you with ongoing risk management concerns.

​Working with Trava means partnering with experts who understand the unique compliance challenges SaaS companies face. We recognize the critical role of security and compliance in SaaS startups, help teams understand SaaS compliance holistically, and guide you through compliance readiness roadmaps that chart your course to success.

Strive for Compliance

No matter what software a SaaS company sells, you must be aware of compliance to succeed and reduce vulnerabilities. And Trava is here to help! We understand that your exact compliance plan will depend on many variables and will provide customized plans for you. But no matter your starting point, you can work to be compliant and boost your overall cybersecurity protection with Trava. Not only do we offer comprehensive data and vulnerability management for compliance frameworks, but we also stand with you during audits, tackling tough questions together. Contact us if you are concerned about your SaaS regulatory compliance or other security concerns. We’ll be glad to give you a free consultation. You can also learn with us through our blog, case studies, resources, podcasts, videos, and news.

Questions About SaaS Regulations?

Trava helps SaaS growth companies navigate all of the ins and outs of compliance.

Learn more about how your business can excel with compliance as a service, compliance readiness, data privacy, and AI risk management support from Trava. We can take your business from zero to audit-ready in just weeks with our state-of-the-art security and compliance tools.

SaaS Compliance FAQs

What’s the difference between SOC 2 Type 1 and Type 2?

SOC 2 Type 1 evaluates the design of your security controls as of the measurement date. It’s a snapshot assessment. Soc 2 Type 2 looks at how effective those controls are in practice, over a minimum six-month period. Most enterprise customers want Type 2 compliance because it demonstrates that your security controls work in real-world scenarios.

How long does it take to achieve SOC 2 compliance?

Most SaaS companies can reach SOC 2 Type 2 compliance in six to 12 months. This typically involves two to four months of preparation, followed by six to 12 months of operating the controls you’ve established to gather evidence for your audit. Timelines can vary based on your company’s current cybersecurity maturity level.

Do I need both SOC 2 and ISO 27001?

Not necessarily. It depends on your target markets and customer requirements. SOC 2 is a more common requirement for North American customers, while ISO 27001 carries more weight internationally. Many mature SaaS businesses ultimately pursue both certification to maximize their access to opportunities across markets.

Can small SaaS companies with limited budgets still reach compliance?

Yes, companies of all sizes can achieve compliance. Small businesses can begin with essential controls, leveraging cloud provider security features instead of maintaining them internally.

You can also work with fractional compliance advisors and teams through Trava instead of adding full-time staff to your payroll. The key is to rightsize your compliance program to match your actual risks and customer requirements, and to evolve as you grow.