Should financial entities include APIs and third-party paths in penetration testing?

Should financial entities test APIs and third-party paths, or only the app front door?

Penetration testing should follow the business path to impact, not stop at the visible application boundary. If an API, SaaS integration, or provider connection can move money, expose customer data, or administer a critical service, it is part of the attack surface and should be in scope. For financial entities, that is also an operational resilience question, not just a web app question.

Why the full service path matters in financial testing

Modern financial services are assembled from internal apps, partner APIs, cloud services, payment processors, identity providers, and outsourced operations. A tester who only probes the user interface can miss the path that actually carries privileged requests, token exchange, account linking, or data synchronisation. In practice, the security question is whether the integrated service chain can be abused, not whether the homepage looks hardened.

That is why testing should include the interfaces that enable authentication, authorisation, transaction initiation, and data retrieval. A weak third-party path can turn a well-built application into a vulnerable system if the trust boundary is misplaced, if scopes are too broad, or if partner credentials can be replayed, stolen, or overused. OWASP API Security Top 10 is useful here because it focuses attention on broken authentication, broken authorisation, and other API-specific failure modes that often sit outside the browser path.

For that same reason, service dependencies should be tested as part of the material process they support. If the business flow depends on a vendor callback, an embedded token, or a federated connection, the test should show whether that dependency can be abused to reach sensitive functions. The security boundary is the path that confers real authority, not the neatest technical layer on the diagram. Third-Party, B2B and Contractor Access Guide is a practical reference for thinking about sponsored access, least privilege, and time limits across external relationships.

What good scope looks like for APIs and provider connections

Good scoping starts with critical functions, then traces every identity-bearing path that can reach them. That means internal APIs, partner APIs, vendor consoles, delegated admin paths, machine-to-machine authentication, and any back-channel that can alter balances, reset credentials, export records, or approve workflows. Where the integration itself is the route to impact, excluding it produces a false sense of confidence.

Financial entities should also distinguish between simple connectivity testing and service-path testing. Connectivity checks ask whether the port is open. Service-path testing asks whether the request can be authorised, whether the token can be abused, whether the partner can overreach, and whether failover or fallback logic opens a weaker route. This is why third-party and API testing belongs in resilience and security testing plans together, especially when the dependency chain is part of the regulated service. The EU Digital Operational Resilience Act (DORA) is relevant because it frames ICT third-party risk and resilience testing as part of keeping critical services functioning under stress.

When the path includes secrets or delegated credentials, the test should verify more than exploitability. It should confirm how quickly tokens can be revoked, whether credential scope matches the business need, and whether the vendor path is monitored closely enough to detect misuse. IAM and IGA Basics is a useful companion for understanding why access reviews, entitlement control, and lifecycle discipline matter even when the entry point is an integration rather than a human user.

What changes when a third party is part of the attack path

A third-party path changes the test because it changes the trust model. The question is no longer only “Can an attacker break the bank’s edge?” It becomes “Can an attacker abuse a trusted integration, stolen token, or over-permissioned provider to act as if they were inside the bank?” That is a materially different failure mode, with different blast radius and different evidence requirements.

Third-party paths also create dependency risk. If the provider is compromised, if the integration is weakly segmented, or if the bank cannot prove what the provider could reach, the organisation may be unable to demonstrate that the critical service was adequately protected. That is especially important where the vendor path can access production data or operational controls. Historical supply-chain and token-theft incidents show why this matters, including cases where stolen OAuth tokens or exposed keys were enough to reach downstream systems. Slack GitHub breach 2022 illustrates how a trusted external path can become the route to sensitive internal access when tokens are abused.

Testing should therefore include compromise assumptions, not just happy-path functionality. If a vendor integration can be abused after token theft, the organisation should know whether the detection, containment, and revocation steps are fast enough to limit impact. That is the difference between a theoretical control and a resilience control.

Risk and Threat Considerations

APIs and third-party connections widen the practical attack surface because they often carry more authority than the front-end user flow. If a provider connection is trusted too broadly, an attacker does not need to attack the main application directly, they can target the integration, credential, or callback path that has better privileges and less scrutiny.

Failure mechanism: The organisation tests the visible application but does not test the integration path that actually moves sensitive data or triggers critical actions. Broken authorisation, stolen tokens, overbroad scopes, weak partner segmentation, or unsafe fallback logic can then provide a quieter route to impact.

Impact: The result can be unauthorised data access, fraudulent transactions, operational disruption, or loss of assurance that critical services were protected under realistic compromise conditions. In a regulated financial environment, that also weakens the evidence needed to prove resilience and dependency control.

Practitioner Guidance

What to prioritise: Put the highest-value business flows in scope first, especially those that can move funds, expose sensitive records, or administer production services through APIs or third parties. If the path can change the state of a critical process, it deserves the same testing attention as the application front end.

What to verify: Confirm that the test plan covers delegated access, service-to-service authentication, token scope, revocation, fallback paths, and vendor-administered functions. The useful question is not whether the integration works, but whether it can be abused to do more than the business intended.

Practitioner takeaway: Financial entities should scope penetration testing to the real trust path to impact, because the most consequential weakness is often not the interface customers see, but the API or provider path that the business implicitly trusts.

Related resources from NHI Mgmt Group

• Why do third-party dependencies make DORA compliance harder for financial entities?
• Why does weak third-party oversight create outsized DORA risk for banks and other financial entities?
• Why do application testing tools matter for NHI governance?
• How should banks govern third-party access to open banking APIs?