Third-Party Risk Rules: What They Mean for Your Bank

Banks don’t just “run on banks” anymore. They run on cloud platforms, payment processors, identity providers, call centers, fraud tools, data brokers, and a long list of vendors you’ll never see—until something breaks.

On 10 December 2025, the Basel Committee published principles for the sound management of third-party risk in the banking sector. That sounds like inside-baseball for compliance teams. It isn’t. When banks outsource critical services, your day-to-day banking reliability—logins, card payments, loan servicing, fraud protection, even how quickly a bank can recover from a cyber incident—depends on how well those third parties are managed.

This post connects the dots for our Intelligence artificielle dans la cybersécurité series: third-party risk management is now inseparable from AI in cybersecurity, because many of the “third parties” banks rely on are AI-driven fraud engines, anomaly detection platforms, and cloud-based security operations.

One-line reality check: If a bank can’t control third-party risk, it can’t control its operational risk—and that eventually shows up as outages, fraud losses, tighter credit, and higher costs.

Why third-party risk suddenly sits at the center of banking

Answer first: Third-party risk has become a top-tier banking risk because digital banking now depends on external providers for critical operations, and those dependencies create concentrated points of failure.

A decade ago, “outsourcing” often meant back-office functions. Today it includes core capabilities:

• Cloud infrastructure and data storage
• Card and real-time payments processing
• Know-your-customer (KYC) checks and identity verification
• Anti-money laundering (AML) monitoring tools
• Fraud detection and behavioral biometrics (often AI-based)
• Customer service platforms and chat systems

The Basel Committee’s update replaces older thinking (the 2005 Joint Forum outsourcing guidance) with principles designed for a world where third parties are more numerous, more specialized, and more deeply embedded.

The hidden chain: you don’t just have “a vendor”

Banks rarely buy a single service. They buy a stack.

Example: your bank contracts with a fraud-prevention vendor that runs on a major cloud provider, uses a third-party data enrichment feed, and subcontracts model monitoring to another specialist. If any link fails—or gets breached—customers experience it as “my bank is down” or “my account got drained.”

That’s why modern third-party risk management focuses on four layers:

1. The vendor
2. The vendor’s subcontractors (fourth parties)
3. Shared infrastructure (cloud, telecom)
4. Data flows across the chain

What Basel’s principles change (and why it matters to consumers)

Answer first: The principles create a common baseline for how banks and supervisors expect third-party arrangements to be governed, monitored, and controlled—especially where services are critical.

The Basel Committee isn’t a global lawmaker. Its standards don’t automatically become law everywhere. But Basel guidance is influential: regulators frequently align local rules with it, and banks with international footprints often implement Basel-aligned programs to avoid being the “weakest jurisdiction.”

Here’s the practical shift: third-party risk is no longer treated as a procurement checkbox. It’s framed as a board-level governance topic tied to resilience.

The “critical service” lens

A useful way to understand these principles is to think in terms of criticality:

• If a vendor fails and customers can’t access funds, payments can’t settle, or fraud spikes, that’s critical.
• If a vendor fails and it’s annoying but manageable, it’s non-critical.

That sounds obvious, but it drives how banks should behave:

• More due diligence before contracting
• Stronger contractual controls (audit rights, incident reporting, data handling)
• Ongoing monitoring (not just annual reviews)
• Exit and substitution plans so a bank can switch providers without chaos

Consumers should care because “critical service” failures are the ones that lead to:

• card declines at checkout
• delayed payroll deposits
• inability to move money during market volatility
• extended fraud disputes and reimbursement delays

AI in cybersecurity: the third-party risk you didn’t know you had

Answer first: As banks adopt AI-driven security and fraud tools from vendors, they inherit new risks—model risk, data risk, and dependency risk—that must be managed like any other third-party exposure.

In this series, we’ve talked about how l’IA renforce la détection des cybermenaces. That’s true. But AI also introduces a twist: the “product” isn’t static software. It’s an evolving model shaped by data.

Three AI-specific third-party risks banks can’t ignore

1. Model drift and performance decay
   Fraud patterns change fast—especially around the holidays and major shopping events. AI models that worked in October can miss new attack patterns in December. If the model is vendor-managed, the bank needs clear expectations for testing, retraining, and performance reporting.

2. Adversarial abuse
   Attackers probe systems to learn what triggers flags. With AI, they can automate probing and craft transactions that “look normal.” That turns vendor tools into high-value targets. Banks need assurance about adversarial testing and hardening.

3. Data governance and privacy leakage
   AI systems often require behavioral signals (device fingerprints, transaction context, session metadata). If data sharing is sloppy, you get privacy risk and regulatory risk. The principles push toward tighter controls over what data is shared, how it’s stored, and who can access it.

Snippet-worthy take: An AI fraud tool can reduce losses—and still increase risk—if the bank can’t measure and govern what the vendor’s model is doing.

A real-world scenario (the kind banks plan for)

It’s late December. Online shopping spikes. A major identity verification provider has an outage. New account openings stall. Fraud teams can’t verify certain customers, so the bank tightens controls as a defensive move. Customers experience:

• longer onboarding times
• more “manual review” holds
• higher false declines on legitimate purchases

That’s third-party risk translated into personal finance friction.

How stronger third-party controls can affect interest rates and fees

Answer first: Better third-party risk management reduces operational and fraud losses, and it lowers the likelihood of disruptive incidents—costs that otherwise get passed to consumers through fees, tighter credit, or less competitive rates.

Banks price products based on risk and cost. When a bank suffers repeated outages or fraud spikes tied to third parties, it typically reacts in predictable ways:

• raises internal loss assumptions
• invests heavily in remediation (often urgent, expensive work)
• tightens underwriting criteria n- adds friction to transactions

Over time, those costs can show up as:

• less generous savings promotions
• higher account fees (especially on “premium” services)
• tighter credit limits or higher APRs for certain segments

I’m not claiming a direct one-to-one relationship (“Basel principle #7 lowered your mortgage rate”). It doesn’t work like that. The relationship is system-level: fewer large incidents and better resilience support a more stable banking environment, and stability supports more competitive pricing.

Why regulators care: financial stability is made of small failures

Major crises aren’t always born from a single spectacular event. They often start with clusters of operational failures—payment disruptions, liquidity stress from customer panic, fraud surges, and loss of confidence.

Third-party concentration risk makes this worse. If many banks depend on the same cloud provider or payment processor, one outage becomes a multi-bank event. Basel’s “common baseline” approach is aimed at reducing that tail risk.

What you can do as a customer: a practical checklist

Answer first: You can’t control your bank’s vendor contracts, but you can reduce your exposure to third-party failures with simple redundancy and smarter security habits.

Here’s what I recommend—especially heading into a new year when budgets, renewals, and big purchases are common.

Build personal “operational resilience”

• Keep two ways to pay: one card from your main bank and a backup (or a second bank). Vendor outages often hit one rail harder than another.
• Maintain a small buffer outside your primary account: even a modest emergency fund at a separate institution can keep bills paid during a service disruption.
• Turn on real-time alerts: transaction alerts reduce the window between fraud and detection.
• Use passkeys or app-based MFA where available: SIM-swap and SMS interception remain common. Strong authentication reduces dependence on weaker third-party telecom controls.

Ask smarter questions when choosing a bank or fintech

You won’t get a full vendor list. But you can still assess maturity:

• Does the bank communicate clearly during outages?
• Do they publish incident updates in-app?
• How fast do they resolve disputes and reimburse verified fraud?
• Do they offer granular security controls (spending limits, merchant locks, travel toggles)?

These are signals of operational discipline, including third-party oversight.

For small business owners: treat your bank like a critical vendor

If you run payroll or take card payments, you’re living inside this risk model too.

• Keep a backup payment method (ACH + card processor redundancy if feasible)
• Export key reports regularly (invoices, transaction histories)
• Separate operating cash and tax cash across institutions

When a bank’s third-party fails, the blast radius often hits small businesses first.

What happens next: expect more scrutiny, not less

Answer first: Basel’s principles point toward more consistent supervisory expectations, more rigorous vendor governance, and more attention to technology and fintech dependencies—including AI tooling.

The Basel Committee also signaled it will keep monitoring digitalisation of finance and financial technology from a prudential perspective. Translation: as banks add more fintech partnerships, embedded finance, and AI-driven cybersecurity controls, supervisors will keep pushing for clearer accountability.

That’s a good thing. I’d rather have banks slowed down a little by strong third-party risk management than sped up by fragile dependencies.

For our Intelligence artificielle dans la cybersécurité series, this is a key connective thread: AI improves detection, but governance makes it safe. If 2026 is the year more banks rely on third-party AI to fight fraud, then 2026 also has to be the year they get serious about third-party risk.

Your move as a consumer is simple: build redundancy, use stronger authentication, and choose providers that behave like reliability is part of the product.

If your primary bank had a full-day outage tomorrow, what’s your fallback plan—cash flow, bill payments, and access to savings?