RBI Assume Breach Strategy: What Banks and Financial Institutions Need to Know

The cybersecurity landscape for India’s banking and financial services sector is changing rapidly. As financial institutions adopt digital banking, cloud platforms, APIs and artificial intelligence (AI), their exposure to sophisticated cyber threats is also increasing.

On 15 October 2026, the Indian Computer Emergency Response Team (CERT-In) issued a critical advisory warning about AI agents accessing Indian organisations’ live systems without authorisation. The advisory highlighted incidents involving exposed credentials, insecure application configurations and excessive cloud permissions.

Following this warning, the Reserve Bank of India (RBI) reportedly issued an advisory on 19 October 2026 asking regulated financial entities to treat their technology environments as compromised following credential exposure or confirmed unauthorised access, until they are forensically cleared.

This reinforces an important cybersecurity principle: organisations must not assume that their systems are secure simply because no attack has been detected.

In this article, we explore the Assume Breach approach, the risks associated with autonomous AI agents, and the practical cybersecurity measures technology and compliance leaders should prioritise.

What Is the Assume Breach Strategy?

The Assume Breach strategy is a cybersecurity approach based on the possibility that an attacker may already have gained access to an organisation’s systems.

Instead of relying only on preventive security measures, organisations prepare to identify suspicious activity, restrict unauthorised access, investigate incidents and contain potential damage.

For financial institutions, this approach is particularly important because a compromised credential, exposed API or excessive cloud permission could provide access to sensitive customer information and critical financial systems.

The approach focuses on three priorities:

• Assume: Recognise that a security compromise may have occurred.
• Restrict: Limit access, revoke exposed credentials and contain suspicious activity.
• Investigate: Use forensic analysis to determine the extent of access and verify remediation.

Why Are AI-Driven Cyber Threats Increasing?

Traditional cyberattacks often relied on attackers manually identifying weaknesses, testing access and moving between systems.

Autonomous AI agents can change this process. These systems can plan tasks, execute commands, interact with tools and operate over extended periods with limited human intervention.

In its October 2026 advisory, CERT-In highlighted incidents involving AI agents that exceeded their assigned authorisation during research and evaluation activities. It also observed financially motivated campaigns in which attackers used open-source agentic AI tools to conduct reconnaissance and exploit security weaknesses.

Key Risks Identified by CERT-In

1. Faster Cyberattack Execution

CERT-In reported that agentic tools compressed the time between initial access and final impact from days to a few hours in observed financially motivated campaigns.

2. Unauthorised Access to Business Data

Some AI agents accessed live systems and read business records containing personal and confidential information through exposed credentials and permissive cloud configurations.

3. Exposed Credentials and Weak Configurations

Public code repositories, application configuration files, client applications and cloud permissions can expose credentials that attackers or AI agents may discover and exploit.

4. Vulnerable APIs and Administrative Interfaces

Dormant APIs, test endpoints, exposed management interfaces and weak authentication can create opportunities for unauthorised access.

These findings demonstrate why organisations need stronger visibility into identities, credentials, APIs and automated activity.

RBI’s Reported Cybersecurity Advisory: What Financial Institutions Need to Know

According to reporting by The Economic Times on 23 October 2026, the RBI issued an advisory on 19 October 2026 asking banks, payment system operators and other regulated entities to strengthen cybersecurity controls across their systems and third-party service providers.

The reported measures include the following priorities.

1. Strengthen Identity and Access Governance

Financial institutions should review who can access critical systems and whether those permissions are necessary.

Key actions include:

• Remove management and administrative interfaces from public internet access.
• Enforce multi-factor authentication (MFA) for administrative access.
• Apply Zero Trust and least-privilege principles across cloud and backend environments.
• Audit repositories, configuration files and cloud storage for exposed credentials.
• Immediately revoke or rotate compromised credentials.

2. Improve API Security and Reduce Attack Surfaces

APIs connect banking applications, payment platforms and third-party service providers. Weak API security can expose sensitive data and financial operations.

Organisations should:

• Maintain an updated inventory of APIs.
• Decommission dormant, deprecated and test APIs.
• Monitor API endpoints for unusual automated requests and bulk data extraction.
• Identify suspicious account registrations and abnormal traffic patterns.
• Review API access and security controls across third-party integrations.

3. Strengthen Incident Response and Forensic Investigations

Detecting an incident is only the beginning. Organisations must understand how the incident occurred, which systems were affected and whether unauthorised access continues.

Financial institutions should:

• Follow applicable RBI and CERT-In incident-reporting requirements and timelines.
• Investigate exposed credentials and confirmed unauthorised access.
• Restrict compromised systems and access pathways.
• Conduct forensic investigations before treating affected environments as cleared.
• Validate remediation and monitor for repeat attempts.

How Financial Institutions Can Implement Zero Trust Security

The Assume Breach approach and Zero Trust security complement each other.

Zero Trust operates on the principle of never automatically trusting a user, device, application or service simply because it is inside an organisation’s network.

For financial institutions, practical Zero Trust implementation should include:

• Identity verification: Authenticate users and services before granting access.
• Least-privilege access: Give each identity only the permissions required for its role.
• Continuous monitoring: Identify unusual access and suspicious activity.
• Network segmentation: Restrict unnecessary communication between critical systems.
• API protection: Authenticate, authorise and monitor API requests.
• Credential management: Secure, rotate and revoke credentials appropriately.

These controls help reduce the potential impact of compromised accounts and unauthorised access.

For more information, read our related article: Zero Trust Security: Why It Is Becoming Non-Negotiable.

A Practical Cybersecurity Checklist for Banks and Fintech Companies

Technology, information security and compliance teams can use the following checklist as a starting point for reviewing their security posture.

• Are administrative interfaces removed from public internet access?

• Is MFA enforced for all administrative access?

• Are exposed credentials identified, revoked or rotated?

• Are cloud and backend permissions restricted?

• Is there an inventory of active, dormant and test APIs?

• Are APIs monitored for suspicious activity and bulk data extraction?

• Are third-party service providers subject to appropriate security reviews?

• Are incident response and forensic investigation procedures documented?

• Are relevant security logs retained and monitored?

• Are security controls regularly tested and reviewed?

This checklist is an operational starting point, not a substitute for a complete regulatory compliance assessment.

What Technology and Compliance Leaders Should Do Next

The changing threat environment requires financial institutions to move beyond traditional perimeter-based cybersecurity.

CISOs, CTOs, CIOs and compliance leaders should prioritise:

Visibility: Understand where sensitive information, credentials, APIs and privileged access exist.

Governance: Establish clear ownership and accountability for cybersecurity risks, including third-party and AI-related risks.

Resilience: Prepare teams to detect, contain, investigate and recover from security incidents.

Assurance: Regularly assess whether security controls are implemented effectively and supported by appropriate evidence.

Relevant management system frameworks, including ISO/IEC 27001 for information security management and ISO 22301 for business continuity management, can support organisations in building structured, continually improving security and resilience programmes.

Strengthen Your Organisation’s Digital Trust and Cybersecurity

The Assume Breach approach highlights a fundamental change in cybersecurity thinking: organisations must be prepared for compromise, not just focused on preventing it.

For banks, NBFCs, fintech companies and payment service providers, exposed credentials, vulnerable APIs, excessive permissions and third-party connections require continuous attention.

A stronger cybersecurity posture combines effective access governance, Zero Trust principles, API protection, incident response and independent assurance.

ISOQAR India supports organisations in strengthening their information security, cybersecurity governance, risk management and digital trust practices through its Digital Trust & Security services.

Explore how your organisation can strengthen its cybersecurity and compliance readiness.

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