Understanding Common SaaS Security Threats

SaaS adoption is at an all-time high, and so are the risks. The convenience and scalability of cloud-based software come with a new class of security challenges that don’t always follow the rules of traditional IT. For IT managers, SaaS vendors, and business decision-makers, understanding these threats is the first step in building a resilient, secure environment.

In this post, we’ll break down the most common security threats in SaaS environments, how they impact your organization, and what you can do to defend against them.

1. Account Takeover (ATO)

What it is:

Unauthorized access to a user’s account—often through phishing, credential stuffing, or brute-force attacks.

Why it matters:

Once an attacker gains access to a legitimate account, they can move laterally across systems, exfiltrate sensitive data, or impersonate users for social engineering attacks.

What to do:

Enforce Multi-Factor Authentication (MFA) across all accounts
Monitor for abnormal login patterns and device locations
Use identity providers (IdPs) like Okta to manage secure access centrally

2. Shadow IT

What it is:

The use of unapproved SaaS tools by employees, often for productivity, collaboration, or file sharing.

Why it matters:

Shadow IT introduces data sprawl, inconsistent access control, and unmonitored risks that bypass formal security protocols.

What to do:

Run SaaS discovery scans to identify unauthorized apps
Create a SaaS usage policy and educate staff on approved tools
Integrate approved tools into SSO platforms to reduce rogue adoption

3. Data Leakage

What it is:

Sensitive data (e.g., customer records, IP, financial info) is exposed unintentionally or maliciously—often through misconfigured sharing settings, public links, or insider activity.

Why it matters:

Data breaches can lead to compliance violations (e.g., HIPAA, GDPR), financial loss, and brand damage.

What to do:

Apply least privilege access across files, systems, and users
Use data loss prevention (DLP) tools to monitor file movement
Train users on secure file sharing practices

4. Insecure Integrations and APIs

What it is:

SaaS applications often rely on third-party integrations and APIs. If these connections lack proper security (e.g., weak authentication, excessive permissions), they become entry points for attackers.

Why it matters:

Even if your app is secure, a vulnerable third-party tool can expose your entire ecosystem.

What to do:

Audit all integrations for OAuth scopes and API key management
Disable unused or legacy API endpoints
Review third-party vendor security assessments before integration

5. Misconfigured Security Settings

What it is:

Default or poorly managed settings, such as open access roles, public dashboards, or unencrypted storage, can leave sensitive areas exposed.

Why it matters:

Many breaches occur not from complex hacks, but from simple misconfigurations, like a public Google Drive folder or an unsecured S3 bucket.

What to do:

Conduct regular SaaS security configuration reviews
Use tools like Microsoft Secure Score or Google Admin security center
Establish a change management process for admin-level settings

6. Privileged Access Abuse

What it is:

Users or admins with elevated privileges may abuse their access, intentionally or unintentionally make damaging changes.

Why it matters:

Overprivileged users pose a risk to both security and operational stability.

What to do:

Implement Role-Based Access Control (RBAC) and enforce least privilege
Audit and rotate privileged accounts regularly
Apply MFA and session monitoring for admin-level users

7. Phishing & Social Engineering

What it is:

Attackers trick users into sharing credentials or executing actions that compromise systems, like clicking malicious links, entering info into spoofed portals, or giving access permissions.

Why it matters:

Most SaaS breaches begin with human error, and phishing is still the most effective method for attackers.

What to do:

Provide regular security awareness training
Run simulated phishing campaigns
Deploy tools that detect and block suspicious URLs in email and chat

8. Weak Encryption Practices

What it is:

Failure to encrypt data in transit or at rest, either because encryption is disabled, outdated, or inconsistently applied.

Why it matters:

Without encryption, your data is readable to anyone who intercepts it, including during transport, storage, or in backups.

What to do:

Enforce TLS 1.2+ for all communications
Use AES-256 encryption for stored data
Implement robust key management strategies

→ Learn more: Data Encryption Strategies for SaaS Applications

9. Inadequate Offboarding Processes

What it is:

When former employees or contractors retain access to systems or data after their departure.

Why it matters:

Dormant accounts become prime targets for ATO or insider threats.

What to do:

Automate deprovisioning through your identity platform
Maintain clear offboarding checklists for IT and HR
Periodically audit active user accounts and access logs

10. Vendor Supply Chain Risks

What it is:

Your SaaS app might depend on other providers (e.g., hosting, payment, analytics). If one of them is compromised, your app inherits the risk.

Why it matters:

Attackers often target the weakest link in the supply chain—not your code, but your partners’.

What to do:

Maintain a vendor risk assessment process
Ensure contracts require vendors to meet baseline security controls
Monitor vendors for breach disclosures and security incidents

Final Thoughts

SaaS offers agility, scalability, and efficiency—but without the right security measures, it also introduces serious threats. As an IT leader or SaaS manager, understanding these risks helps you design better systems, choose the right vendors, and protect your users’ trust.

Security isn’t one and done. It’s an evolving process of education, visibility, and enforcement.

For a complete framework on SaaS security planning, read the full guide:
👉 Comprehensive SaaS Security Management: Ensuring Data Integrity, Compliance, and Risk Mitigation