Students Are Customers: Third-Party Risk Management Is Essential to Protect Their Data

 By SkyBlackBox 

In today’s digitally connected education system, students are more than just learners—they're also customers. Like any business-client relationship, trust is at the core. Educational institutions collect and store sensitive personal information: names, addresses, social security numbers, academic records, and even payment details. This makes schools and universities prime targets for cyberattacks. But as more educational tools and platforms rely on third-party vendors, the risk doesn’t stop at internal systems. The hidden danger often lies in who you’re connected to. 

That’s why third-party risk management (TPRM) is no longer optional—it’s essential. Let’s dive into why and how your institution must treat student data as a high-value asset and protect it through robust third-party risk strategies. 

The Shift: Students as Customers in the Digital Age 

With online learning platforms, digital exams, student portals, and cloud-based data storage, students now interact with educational institutions much like customers do with e-commerce businesses. They expect secure, seamless experiences and assume their personal data is well-protected. 

However, a 2023 report by EDUCAUSE found that over 67% of educational data breaches were linked to third-party vendors. Whether it's a virtual classroom tool or a payment gateway, if a third-party vendor gets compromised, student data could be exposed—even if your internal systems are airtight. 

What Exactly Is Third-Party Risk? 

Third-party risk refers to the exposure your institution faces when it relies on external vendors, software providers, or service platforms. These partners often have access to your systems or directly handle sensitive student data. 

Risks include: 

• Data breaches through insecure vendor platforms 

• Lack of compliance with privacy laws like FERPA, GDPR, or HIPAA 

• Operational disruptions due to vendor outages or security failures 

• Reputational damage after publicized breaches 

And while institutions often focus heavily on their internal cybersecurity posture, they may not vet or monitor vendors with the same rigor. 

 Key Areas Where Third-Party Risk Impacts Student Data 

1. Learning Management Systems (LMS): Tools like Canvas, Blackboard, or Moodle may store grades, discussions, and student login credentials. Any misconfiguration or outdated software version could be an entry point for attackers. 

2. Payment Gateways:  Whether it's tuition or library fines, third-party processors hold critical financial data. Without proper encryption or tokenization, this information is vulnerable. 

3. EdTech Applications:  Many apps used for attendance, assessments, or analytics integrate directly with school systems. A breach here could expose both behavioral data and personal identifiers. 

4. Cloud Storage Providers:  While convenient, not all cloud vendors offer the same level of security. Misconfigured cloud databases are one of the most common sources of massive data leaks.  

Why Third-Party Risk Management Is a Must 

Reputation and trust: Students and parents trust that you’ll keep their information safe. One major breach can shatter that trust and damage your reputation for years. 

Legal compliance: Regulations like the Family Educational Rights and Privacy Act (FERPA) require institutions to safeguard student data. Non-compliance, even by a vendor, could result in penalties. 

Operational continuity: If a third-party service fails or gets attacked, it could halt operations—whether it's online classes, grade submissions, or enrollment systems. 

Best Practices for Managing Third-Party Risk in Education Vendor Due Diligence:  Before partnering, assess each vendor’s security policies, compliance certifications, and past breach history. 

Contractual Safeguards:  Include security requirements, breach notification clauses, and data handling responsibilities in contracts.

 Ongoing Monitoring:  Don't "set and forget." Continuously monitor vendor activity, especially those with access to student data. 

Risk Tiering: Classify vendors by risk level based on the type and amount of data they access. Focus your efforts where the impact is highest.

Incident Response Planning:  Ensure both your institution and your vendors have clear, tested plans for handling data breaches quickly and transparently. 

Use of Risk Management Tools:  Platforms like SkyBlackBox help you assess, monitor, and mitigate third-party risks in real time, offering peace of mind and regulatory alignment. 

Final Thoughts 

Treating students like customers means providing them not just with quality education but also with the highest standards of data privacy and protection. As third-party tools become integral to your institution’s success, third-party risk management becomes the frontline of your cybersecurity defense. 

Don’t let a vendor's vulnerability become your liability. Secure your students’ data—and your institution’s future—by making third-party risk management a strategic priority. 

Need help identifying and managing your institution's third-party risk? 

 Let SkyBlackBox be your partner in data protection. Contact us today to learn more.