QUICK DEFINITION
Concentration Risk — Risk created when many critical services depend on the same provider, technology or location.
WHY IT MATTERS
Why Concentration Risk matters in finance
A single disruption can affect many institutions simultaneously when dependencies are concentrated.
FINANCIAL SYSTEM CONTEXT
← Back to the Financial Security GlossarySecurity is also a market-infrastructure question
In financial services, concentration risk should be understood in relation to operational continuity, data integrity, payments, market infrastructure and interconnected dependencies. A control can be technically effective while still leaving material resilience risk if critical services cannot continue or recover during disruption.