Small tech-driven businesses rely heavily on digital tools for everyday operations. The EU’s Digital Operational Resilience Act (DORA) aims to fortify these digital ecosystems so that even small firms can withstand cyber “storms” and keep serving customers when disruptions strike.
If you’re a founder, CEO, or CTO of a tech-led small or medium-sized business (SMB) in the EU, you may have heard the buzz about the Digital Operational Resilience Act (DORA). At first glance, DORA might sound like something only big banks or financial giants need to worry about.
But this new EU regulation is very relevant for tech-driven SMBs like yours. In this article, we’ll break down what DORA entails, why it’s important for your business, which types of SMBs are most affected, and how embracing DORA can benefit you (beyond just avoiding fines).
We’ll also share practical tips to achieve compliance and real-world examples of smaller companies that turned DORA into a business advantage. Let’s dive in with a conversational, no-nonsense look at DORA, and why you should care.
What is DORA, and Why Should SMBs Care?
DORA stands for Digital Operational Resilience Act, an EU regulation introduced as part of Europe’s digital finance strategy. It officially entered into force in January 2023 and will start applying on January 17, 2025,. In plain terms, DORA is a law designed to ensure that businesses in the financial sector (and their tech providers) can withstand, respond to, and recover from IT disruptions and cyberattacks.
Think of anything that could knock out your digital operations, a major cyber breach, a cloud outage, a software failure, DORA wants to make sure that even if those things happen, the financial system keeps running and customers are protected.
Now, you might be thinking: “Okay, but I run a small company, not a big bank. Why should I care?” The key is that DORA casts a wide net. In fact, it’s been called “the widest scope of EU financial-sector cyber regulation to date,” much like how GDPR set a broad standard for data protection.
DORA doesn’t just apply to big banks, it covers over 20 types of financial entities of all sizes, including banks, fintech startups, payment providers, insurance firms, investment companies, crypto-asset service providers, and more. Yes, that includes smaller players. Regulators expect a small fintech or digital insurer to bolster their operational resilience just as a large bank would (with some proportionality in expectations).
In fact, DORA is expected to impact more than 22,000 businesses across the EU, many of them SMBs. So, if you’re in or around the financial services space, chances are DORA matters to you.
Crucially, DORA also affects tech providers that serve the financial industry. If your SMB provides IT services, cloud infrastructure, software, data analytics, or fintech solutions to banks or financial institutions, DORA is indirectly your concern too.
Why? Because your financial clients will need to ensure their vendors (like you) meet certain resilience and security standards. DORA explicitly brings ICT third-party service providers into the fold, from cloud hosting companies to SaaS vendors and even niche tech firms that form part of a bank’s supply chain. While DORA’s rules technically apply to the financial entities, not directly to vendors, in practice you’ll see new contractual requirements and due diligence from your clients to comply with DORA.
If you want to win or keep business with regulated customers, you’ll likely need to demonstrate DORA-level resilience. In short, tech-led SMBs both within the financial sector and those serving it have a stake in DORA.
Even if your startup isn’t strictly a financial entity or vendor today, DORA is part of a broader trend of regulators focusing on operational resilience. It’s about keeping businesses running in the face of digital risks, something that every tech-driven company can relate to.
Embracing the spirit of DORA voluntarily can make sense as a best practice, helping protect your business from downtime and cyber threats. So, understanding DORA isn’t just compliance trivia; it’s learning how to bulletproof your operations in an increasingly digital world.
Which sectors are likely to feel the impact of DORA the most?
Broadly, it’s those in or serving the financial sector, especially where technology is core to the business model (“tech-led” firms). Here are some examples:
Fintech and Financial Services Startups
If you’re a payment institution, an electronic money startup, a digital bank, a peer-to-peer lending platform, a crowdfunding service, or any kind of fintech offering financial services, you’re squarely in DORA’s scope. The regulation applies to banks, insurers, investment firms, and payment providers operating in the EU, regardless of size.
That means a small online payment startup, or a niche investment advisory firm is not exempt. DORA deliberately covers emerging players like crypto-asset service providers as well. So, whether you’re running a crypto exchange, a robo-advisor app, or an insurtech platform, DORA’s rules likely apply.
Importantly, being “small” doesn’t let you off the hook, regulators expect resilience from all these entities. (There are a few narrow exceptions and lighter regimes, such as for some micro-enterprises or specific fund managers, but these are limited.)
The bottom line: if you have a license to do financial business in the EU, assume DORA is part of your new rulebook.
Third-Party Service Providers
Maybe you’re not a financial company yourself, but you provide crucial tech services to those who are. This could be a cloud hosting provider, a cybersecurity firm, a software vendor for banks, a fintech API provider, a data analytics platform used by insurers, etc. DORA has an entire section on technology third-party risk management.
Financial institutions will now need to keep detailed registers of their tech vendors, include specific resilience and security clauses in contracts, and even have exit strategies if a provider fails.
If your SMB is part of that supply chain, expect your customers to ask you to meet these standards. For instance, banks might require you to guarantee certain uptime, allow them to audit your security, or have robust disaster recovery plans in place.
Additionally, a few large tech providers will be designated as “critical” by EU authorities and come under direct oversight. While that status is likely for big players (think major cloud or core banking software companies), even smaller vendors will be held to high expectations through contracts. In short, if your clients are affected by DORA, you’re affected by DORA.
The rest of X-Tech
Even outside traditional finance, the concept of operational resilience is catching on. Sectors like healthcare, e-commerce, and critical infrastructure are also under pressure to manage digital risks (though under different laws).
DORA itself might not legally apply to an e-commerce startup or a manufacturing tech firm, but it’s setting a tone for best practices. Many experts view DORA as part of a shift where operational resilience becomes a standard business requirement, much like data protection after GDPR.
So, if you plan to expand into financial services or simply want to adopt robust risk management early, keeping an eye on DORA’s principles is wise. It can future proof your operations and make you stand out in trustworthiness.
The sectors most likely impacted by DORA are those in the financial value chain, from fintech startups to the tech vendors supporting financial institutions. If you find yourself in that group, DORA isn’t just background noise; it’s something to actively prepare for.
Why Embracing DORA is Good for Business
(Not Just a Compliance Headache)
Let’s face it: new regulations can feel burdensome, especially for a small company with limited resources. But DORA, if approached smartly, can bring tangible benefits to your SMB. It’s not just about avoiding penalties, it’s about strengthening your business. Here are some big advantages of embracing DORA:
Stronger Security and Fewer Disruptions
DORA forces you to shore up your cloud platforms and cybersecurity. By complying, you’ll naturally invest in better defences and backups, which means you’re less likely to suffer crippling outages or breaches. One analysis noted that widespread DORA compliance will lead to improved security and resilience across financial entities, reducing the risk of financial and reputational damage for those who abide by the guidelines.
In other words, following DORA makes your company safer from hackers and system failures, and if something does go wrong, you’ll be in a much better position to recover quickly. For an SMB, even a single major cyber incident can be devastating. By upping your resilience, you’re mitigating the risk of business-ending events before they happen.
Increased Customer and Partner Trust:
In the digital age, trust is a huge selling point. Clients, consumers, and partners want to know they can rely on you. DORA is essentially a framework for digital trust, it pushes companies to be transparent about their operational stability and to consistently deliver services even under strain.
If you can say to your customers, “We follow the latest best practices in operational resilience (DORA) to keep your data and services safe,” that’s a competitive edge. Enhanced security and uptime mean happier customers and a stronger reputation.
As one report put it, companies that comply gain consumer and stakeholder trust thanks to the enhanced safety of their systems. For SMBs trying to win contracts with big banks or attract users to a fintech app, being able to demonstrate DORA-level robustness can set you apart from competitors. Digital trust is becoming a value differentiator for customers, and DORA gives you a roadmap to achieve it.
Better Business Continuity and Risk Management
Going through DORA compliance will make you take a hard look at your risks and continuity plans. This exercise has intrinsic benefits. You’ll likely discover weaknesses (maybe that one critical engineer who holds key system knowledge, or that single point of failure in your cloud architecture) and can address them proactively.
The outcome is a more resilient operation that can weather storms, whether those are cyberattacks, software bugs, or even human errors. Some companies that have leaned into DORA preparation report that they’ve cultivated a culture of technology risk management that drives business value, seeing resilience not as a cost, but as a core aspect of quality service.
When you treat uptime and security as fundamental, you avoid costly downtime, lost sales, and firefighting later. For an SMB, that stability can be a make-or-break factor for growth.
Avoiding Penalties and Meeting Market Expectations
Of course, there’s also the straightforward benefit of staying on the right side of regulators. Non-compliance with DORA can lead to serious consequences, including hefty fines, regulatory sanctions, or even being restricted from certain operations. (Each EU country will enforce penalties, but none will be pleasant.)
Beyond formal penalties, imagine the reputational hit if it comes out that your company suffered an incident and hadn’t followed required practices, clients will lose confidence. By embracing DORA, you avoid those nightmare scenarios.
Additionally, regulators and investors are increasingly expecting even smaller firms to have mature risk controls. Early compliance can make future audits or fundraising due diligence much smoother. It signals that your SMB is well-run and takes its obligations seriously.
In a nutshell, DORA compliance isn’t just about satisfying a regulation, it’s about levelling up your business’s resilience and credibility. You get stronger security, more reliable operations, customer trust, and peace of mind that you’re not one random incident away from disaster.
Yes, there’s effort involved, but the payoff is a sturdier company that can confidently scale and survive in a risky digital landscape. Many SMBs might initially see DORA as “ugh, more red tape,” but those who flip the script and use it as an opportunity will likely reap significant rewards (and sleep better at night knowing their risk is under control).
Best Practices for SMBs to Meet DORA Requirements
So, if you’re convinced that paying attention to DORA is important – now what?
Compliance can sound daunting, especially if you don’t have a dedicated risk department. The good news is DORA provides a clear framework of what you need to do, and there are concrete steps you can follow to get there. Here are some best practices and practical tips to help an SMB achieve DORA compliance (without losing your sanity):
1. Determine Your DORA Scope and Obligations
First, figure out if and how DORA applies to your company. DORA’s Article 2 lists the entities in scope (over 20 categories).
Check if you fall into one of these (e.g., are you a payment institution, an investment firm, a crypto service provider, etc.?). If yes, you’re a “financial entity” under DORA and must meet all applicable requirements. If not, you might be a technology service provider to those entities, in that case, DORA’s rules hit you indirectly via contracts.
Also consider your size: there’s a proportionality principle, meaning regulators won’t expect the exact same depth from an SMB as a huge bank, and micro-enterprises have some lighter requirements. But by and large, assume you need to comply fully if in scope. Knowing your status will shape your compliance strategy.
Example: A small fintech lender realised they squarely fall under DORA, so they focused on meeting all requirements, whereas a software startup selling to banks focused on beefing up contracts and security to satisfy clients’ DORA-related demands.
2. Build a Cross-Functional “DORA” Team
Don’t assign DORA compliance to a single IT person and call it a day. DORA touches on technology, operations, security, legal, and management oversight.
Assemble a team or working group that draws in people with different expertise from across your organisation; technical, legal operations, etc, and someone from leadership to sponsor the effort. If you’re a very small company, this might just be a few people wearing multiple hats (you might even involve an external consultant for guidance), but make sure the responsibility is shared.
Having broad buy-in prevents burnout and blind spots. It also sends a message to your whole organisation that digital resilience is a priority, not just an “IT problem.” When everyone from the CTO to the ops manager understands their role in resilience, you’re building a stronger culture from the get-go.
3. Assess Your Risks and Do a Gap Analysis
Before rushing to buy new security tools, take stock of where you stand. DORA essentially formalises best practices in five areas: technology risk management, incident management, testing, third-party risk, and information sharing. Conduct a comprehensive risk assessment of your digital assets and processes: list out your critical systems, data, and vendors; identify what threats or failures could impact them; and evaluate existing controls.
Then perform a gap analysis against DORA’s requirements, basically comparing what DORA expects you to have in place versus what you currently have. This can be an eye-opening exercise. Maybe you realise you have no formal incident response plan, or your backup routine hasn’t been tested in ages, or you lack documentation. That’s okay, better to find out now than during a crisis.
The gap analysis will turn up a list of action items you need to address to become compliant. It’s a great way to prioritize efforts so you’re not overwhelmed by the “big picture.” Many small firms start with this step because it provides a clear roadmap: it shows which areas are fine and which need work.
4. Strengthen Your Defence and Resilience Measures
DORA expects robust technology risk management. In practice, this means shoring up the security and reliability of your IT systems.
Focus on the basics first:
DORA doesn’t prescribe specific tech solutions, but it wants outcomes. E.g., “minimise risk, promptly detect, respond, recover”. You can leverage well-known frameworks like NIST CSF or ISO 27001 as guides here, since DORA’s expectations align with widely accepted security best practices.
The key is to build resilient systems that can take a punch. For an SMB, investing in things like cloud backup services, endpoint security, and network monitoring may suffice if done thoughtfully. Document what you implement as part of your risk management framework.
Over time, keep reviewing and improving these defences as your business and threats evolve.
5. Develop (and Drill) an Incident Response Plan
Having top-notch security doesn’t mean much if you panic during a crisis. DORA requires firms to establish a clear incident response and recovery plan. This plan should spell out what to do if a major IT incident hits. For example, a cyberattack, a system outage, or data breach.
Outline who is on the incident response team (names and roles), how to reach them 24/7, and the steps they should follow: detect, contain, remediate, recover. Define communication strategies, who communicates to customers, who notifies regulators (DORA mandates that major technology incidents be reported to authorities within tight timelines), and how internal updates are handled.
Set up criteria for what is considered a “major” incident that triggers formal reporting or public communication. Once you have a plan on paper, test it out! Run simulations or tabletop exercises to walk through a hypothetical crisis.
This will train your team and reveal if any steps are missing.
Example: One mid-size company found they had to streamline their incident classification and reporting process to meet DORA’s requirements, but after improving their internal workflows, their incident response efficiency increased significantly, giving them a clearer picture of their risk landscape and better preparedness for cyber threats.
In short: plan for the worst and practice the plan. It will pay off by reducing chaos when an incident inevitably happens.
6. Regularly Test Your Digital Resilience
DORA puts a big emphasis on testing your operational resilience, not just assuming things will work. For SMBs, this means instituting a regime of regular technology tests and drills.
Some examples: perform routine vulnerability scans and penetration tests on your applications and network to catch security holes. Do backup restoration tests – attempt to restore data from backups and see if it works and how long it takes. Conduct disaster recovery exercises where you simulate an outage of a key system and see if you can keep business running (even in a degraded mode).
If you have the resources, consider an annual or bi-annual more comprehensive test of a “severe scenario” (what DORA calls advanced testing, often akin to threat-led penetration testing for critical firms).
Example: A small investment firm under DORA, for instance, implemented a modest testing program – including basic vulnerability and network assessments, focusing on fixing what they found. The outcome was improved digital resilience and full DORA compliance, showing that DORA’s proportional approach lets smaller entities test in a scaled way and still gain strong benefits.
The lesson is: don’t neglect testing. It’s better to discover a weakness in a planned exercise than during real operations. Document your test results and track issues to closure, this not only satisfies DORA’s testing mandate but continuously hardens your tech environment.
7. Manage Your Third-Party Risks and Contracts
Today’s SMBs often rely on a web of third-party providers (cloud platforms, SaaS tools, IT contractors, etc.). Under DORA, you must treat vendor risk as your own risk.
Start by inventorying all your critical ICT service providers, who are the vendors or partners that, if they have a problem, you have a problem?
Make sure you have up-to-date contracts with these providers that include key clauses DORA expects things like service uptime levels, support in case of incidents, data protection obligations, notification duties if they face a cyberattack, and provisions allowing you (or regulators) to audit or inspect their security measures.
DORA requires financial entities to maintain an information register of all IT vendor contracts and their key terms, so get that documentation in order. For each critical vendor, assess their resilience: do they have their own backups and continuity plans? Are they financially stable? If a vendor is not meeting high security standards, consider working with them to improve or finding alternatives.
Also, have contingency plans for vendor failure. E.g., can you switch to another provider or handle a function in-house temporarily if needed? Managing third-party risk can be resource-intensive, but for an SMB it often boils down to focusing on the handful of partnerships that really matter and making sure those don’t become single points of failure.
Remember, outsourcing does not mean offloading responsibility, you’ll still be accountable under DORA, so choose and manage partners wisely.
8. Ensure Governance, Documentation, and Ongoing Improvement
Compliance isn’t a one-and-done project; it’s an ongoing posture. DORA expects that senior management is engaged and that you have governance in place around ICT risk. In practice for an SMB, this means making resilience a boardroom topic or a regular management meeting item.
Provide periodic updates on risk assessments, incident occurrences, and improvements to your leadership (even if that’s just you and a co-founder – take the time to formally review it). Keep documentation for everything: your risk framework, policies, incident logs, test reports, vendor register, training records – so you can demonstrate compliance and learn from these records.
Being diligent in documentation will save you headaches if regulators ask questions or if you undergo an audit. Also, be prepared to report certain info to authorities if required (major incidents, etc.), which means having the data and processes to compile those reports quickly.
Finally, foster a mindset of continuous improvement – or as DORA puts it, a culture of resilience. Threats will evolve and your business will change, so revisit your risk assessments, plans, and controls at least annually or when significant changes occur. Many companies find that after implementing DORA requirements, they operate more smoothly and confidently.
By making this a cycle, assess, improve, test, train, repeat; you ensure that resilience keeps pace with growth. Over time, staying compliant will simply be part of “how you do things,” which is exactly DORA’s goal: baking good operational habits into the company DNA.
Tip: You don’t have to reinvent the wheel on compliance. There are plenty of resources, frameworks, and even software tools to help with these steps. If you’re ever unsure, consider consulting guides from regulators or industry groups, or hiring external experts for a sanity check. Many requirements overlap with standard cybersecurity practices, so investments here often kill two birds with one stone (you get DORA compliance and a better security posture generally).
Real-World Success Stories: SMBs Thriving Under DORA Principles
To make all this concrete, let’s look at a couple of real-world examples (drawn from industry case studies) of tech-led SMBs that have adopted DORA’s principles, and the benefits they’ve seen:
Case Study 1: Mid-Size Insurance Tech Company
"The Incident Response Overhaul."
A medium-sized insurance company in the EU realised they needed to up their game in incident management to meet DORA.
Initially, they struggled with fragmented incident reporting, different teams had different ways of logging issues, making it hard to classify and report incidents within DORA’s guidelines. In response, the company revamped its incident response process: they implemented a centralised incident tracking system and trained staff on new workflows.
They also aligned their criteria with DORA’s definition of “major ICT incidents” and the requirement to report these to authorities promptly. The outcome? The company’s ability to collect, analyse, and share incident information improved dramatically.
They could spot trends and root causes more easily and respond faster when something went wrong. Not only are they now compliant with DORA’s incident reporting rules, but this SMB gained a much clearer understanding of its IT risk landscape. In practice, that means fewer surprises and a higher state of readiness for cyber threats.
As a side benefit, regulators and partners gained confidence that this company can handle problems effectively, which is a big credibility boost for a smaller player in the insurance market.
Case Study 2: Small Investment Firm.
"Resilience Testing on a Budget."
A boutique investment firm (about 50 employees) faced a challenge with DORA’s digital operational resilience testing requirements.
Advanced testing like threat-led penetration tests sounded costly and resource-intensive – a tough ask for a small firm. But instead of throwing up their hands, they applied DORA’s proportionality principle and focused on what made sense for their size.
The firm established a lightweight but thorough testing program they scheduled regular vulnerability scans on their network, conducted tabletop exercises for cyber incidents, and did an annual third-party security audit of their critical trading platform. Each test was followed by fixing any weaknesses found.
Over time, this continuous testing culture led to significant improvements, they hardened their network security, improved data backup processes, and even refined their employee cybersecurity training based on test findings. In the end, the firm enhanced its operational resilience and met DORA requirements fully, demonstrating that even a small company can comply by scaling the effort to its needs.
What did they gain? Peace of mind and demonstrable proof to clients (and regulators) that their operations are secure and reliable. In an industry where trust is everything, this has helped the firm attract clients who might otherwise worry about doing business with a smaller institution. DORA essentially pushed them to reach a higher standard, which became a selling point.
DORA as both a safety net and a growth enabler!
DORA may have its roots in financial regulation, but at its heart it’s about something every tech-led business care about staying operational no matter what. For founders and executives, it’s reassuring (and maybe a little daunting) that the EU is raising the bar on digital resilience.
The era of “move fast and break things” is evolving into “move smart and don’t break under pressure.” Embracing DORA’s principles will help ensure your innovative SMB doesn’t get derailed by a cyber incident or IT meltdown at the worst possible time.
To recap, DORA is now a key consideration for EU SMBs in fintech and beyond, bringing unified rules for managing ICT risks, incident response, testing, and vendor management. It affects a wide range of firms including smaller ones, so it’s wise to assess where you stand.
By investing in compliance, you’re also investing in your business’s longevity – improving security, reliability, and trust. We covered some best practices: from forming a team, assessing gaps, and strengthening defences, to planning for incidents, testing regularly, and overseeing vendors.
None of these are out of reach for an SMB, especially if tackled step by step. And as real examples show, even limited-resource firms have successfully turned these requirements into resilience gains. In the end, think of DORA as both a safety net and a growth enabler. It’s a safety net because it forces you to handle risks that could otherwise put you out of business.
And it’s a growth enabler because a resilient company is more attractive to customers and partners (and suffers fewer costly setbacks). So rather than dreading DORA, embrace it. Use it as a framework to future-proof your tech-powered business. Your team, your customers, and your future self will thank you for the foresight.
After all, strong digital operational resilience isn’t just about complying with law, it’s about building a company that can thrive in good times and survive the bad times. And that is the kind of strength every SMB aspires to have.