Image Source : FinTech Magazine
The Digital Operational Resilience Act (DORA) is poised to send shockwaves throughout the financial industry, as this transformative regulatory framework is set to redefine the operational strategies of financial institutions and their critical service providers. DORA, which is a comprehensive set of guidelines aimed at enhancing the digital resilience of financial entities, is expected to have a profound impact on the way financial businesses operate, interact with their customers, and manage their risk exposure.
At its core, DORA is designed to promote digital operational resilience, which is the ability of financial institutions to withstand, respond to, and recover from disruptions to their digital operations. To achieve this objective, DORA introduces a range of new requirements and guidelines that financial institutions and their critical service providers must adhere to. These requirements include the implementation of robust digital risk management frameworks, the conduct of regular digital resilience testing, and the establishment of effective incident response and crisis management plans.
The implementation of DORA is expected to have a ripple effect throughout the financial industry, as financial institutions and their critical service providers will need to adapt their operational strategies to comply with the new regulatory requirements. This may involve significant investments in new technologies, processes, and skills, as well as changes to their organizational structures and governance arrangements. However, the benefits of DORA are expected to be significant, as it will help to enhance the digital resilience of financial institutions, reduce the risk of operational disruptions, and promote greater confidence and trust in the financial system.
