What is SOC2?

SOC 2 is a set of guidelines that companies follow to show they protect their customers’ data. It focuses on five key areas-security, availability, processing integrity, confidentiality, and privacy-to make sure information is handled safely.

Let's break it down

  • SOC 2: A “Service Organization Control” report, version 2, that checks how a service provider manages data.
  • Guidelines/standards: Rules that tell a company what to do to keep data safe.
  • Companies: Any business that stores, processes, or transmits customer information, especially online services.
  • Protect/keep safe: Prevent unauthorized people from seeing or messing with the data.
  • Customers’ data: Personal or business information that belongs to the people who use the service.
  • Five key areas:
  • Security - defending against hackers and attacks.
  • Availability - making sure the service is up and running when needed.
  • Processing integrity - ensuring data is handled correctly and without errors.
  • Confidentiality - keeping certain information secret.
  • Privacy - respecting how personal data is collected, used, and shared.

Why does it matter?

A SOC 2 report gives customers confidence that a service takes data protection seriously, which can prevent costly breaches, help win contracts, and satisfy legal or industry requirements.

Where is it used?

  • Cloud-based software (SaaS) platforms that store client data.
  • Online storage services such as file-sharing or backup providers.
  • Financial technology (fintech) apps handling payment or banking information.
  • Healthcare or tele-medicine portals that manage patient records.

Good things about it

  • Builds trust with customers and partners.
  • Provides a competitive edge over providers without a SOC 2 report.
  • Helps identify and fix security gaps before they become problems.
  • Recognized internationally, making it useful for global business.
  • Can simplify compliance with other regulations (e.g., HIPAA, GDPR).

Not-so-good things

  • Audits can be expensive, especially for small businesses.
  • The certification process takes time and resources to prepare.
  • SOC 2 focuses on processes, not on guaranteeing zero breaches.
  • Ongoing maintenance is required to keep the report current.