SOC 1 for Fintech
Platforms

SOC 2 covers operational security controls (the Trust Services Criteria), but it does not address controls relevant to financial reporting. If your fintech processes transactions, calculates fees, moves money, or produces data that flows into your clients' financial statements, their external auditors need assurance over those specific controls. That assurance comes from a SOC 1 report governed by SSAE 18 (AT-C 320). Many fintechs need both reports: SOC 1 for the CFO's auditors and SOC 2 for the CISO's security review.

Start with the financial data flows, not the API endpoints. Identify every API call that creates, modifies, or triggers a financial transaction — payment initiation, loan disbursement, fee calculation, settlement, ledger posting. Each of these is a candidate for a control objective. Then map the supporting controls: API authentication and authorization, input validation, idempotency enforcement, rate limiting, webhook delivery verification, and error handling. The control objectives in your SOC 1 are organized by business process (e.g., "Transaction Settlement Accuracy"), not by technical endpoint.

Payment networks (Visa, Mastercard, RuPay), sponsor/partner banks, cloud infrastructure providers (AWS, GCP, Azure), core banking platform vendors, card manufacturers and personalization bureaus, KYC/identity verification providers, and payment orchestration platforms. Each of these performs functions that may be relevant to your clients' financial reporting. Your SOC 1 report must identify each subservice org and state whether they are included (inclusive method) or excluded (carve-out method) from scope.

Almost all fintechs use the carve-out method for large infrastructure partners (banks, card networks, cloud providers) because those organizations will not submit to testing by your CPA firm. The inclusive method is practical only for smaller partners you have contractual leverage over, such as a specialist KYC vendor or a card production bureau. Your SOC 1 report must clearly describe the carved-out services and the control objectives that depend on them, so your clients' auditors know what they need to evaluate separately.

A BaaS provider's SOC 1 focuses heavily on ledger integrity, fund segregation (FBO account controls), and regulatory reporting accuracy for the sponsor bank. The control objectives center on double-entry bookkeeping enforcement, real-time balance accuracy, program-level fund isolation, and data feeds that flow into the sponsor bank's call reports and regulatory filings. A payment processor's SOC 1 is more focused on transaction authorization, settlement accuracy, merchant reconciliation, and fee calculations. The common thread is ICFR relevance, but the specific control objectives differ substantially by vertical.

If your fintech stores, processes, or transmits cardholder data (primary account numbers, CVVs, expiration dates), PCI DSS compliance is mandatory — it is not optional and it is not covered by SOC 1 or SOC 2. Payment processors, card issuers, and BaaS providers that handle card data need PCI DSS. Lending platforms and wealthtech companies that do not touch cardholder data typically do not need PCI DSS. Note that using a PCI-compliant payment processor or tokenization provider reduces but does not eliminate your own PCI scope — you still need a SAQ or ROC depending on your transaction volume and role.

For a fintech with existing engineering practices (version control, code review, access management, incident response), readiness typically takes 8-14 weeks. This covers gap assessment, control documentation, remediation of identified gaps, and evidence collection. The CPA examination itself adds 2-4 weeks for Type I or 6-12 months of observation followed by 3-5 weeks of fieldwork for Type II. Fintechs that already have SOC 2 can often accelerate SOC 1 readiness to 6-10 weeks because many general IT controls overlap between the two reports.

The RBI Cybersecurity Framework (CSF) is a mandatory compliance requirement for entities regulated by the Reserve Bank of India — banks, NBFCs, payment aggregators, and PPI issuers. SOC 1 is a voluntary attestation report that your clients' auditors request. They serve different purposes and audiences: RBI CSF satisfies the regulator, SOC 1 satisfies your enterprise clients' external auditors. Many controls overlap (access management, change management, incident response), and Tranquility Cybersecurity handles both in a coordinated engagement to reduce duplicate effort.