What are Sub-processors?

In today's interconnected world, businesses rarely operate in isolation. Whether you're running an AI-powered SaaS platform like Xtrata or any other data-driven operation, chances are you're relying on third-party services to handle specific tasks. These third parties are known as sub-processors.

Sub-processors are external organisations that process data on behalf of your company. For example, if you use a cloud provider to store customer data or an analytics platform to generate insights, those providers are acting as your sub-processors. They're essential cogs in the machine, but they also come with their own risks—which is why managing them is crucial.

One of the biggest reasons to stay on top of your sub-processors is compliance. Regulations like GDPR and CCPA place strict requirements on how data is handled, even if it's being processed by someone else. If one of your sub-processors suffers a breach or fails to follow the rules, the responsibility could land on your shoulders. No business wants to face hefty fines or lose customer trust over someone else's mistake.

Managing sub-processors also gives you better control over costs and operations. Knowing who's doing what—and at what price—ensures your business is efficient and not paying for overlapping or unnecessary services. It also helps you identify opportunities to consolidate providers or renegotiate contracts.

Finally, there's security. Each sub-processor you use increases your attack surface, so it's vital to assess their security protocols and ensure they align with your own standards. Regular reviews and audits can help reduce risks and keep your data—and your customers—safe.

At Xtrata, we make it easy to manage sub-processors by centralising oversight across operations, costs, security, and compliance. With the right tools and a proactive approach, you can turn sub-processor management into a competitive advantage, rather than a headache.