FedRAMP vs SOC 2: Key Differences & Which to Choose in 2026

TL;DR: Quick Takeaways

•FedRAMP is federal cloud authorization (325+ controls); SOC 2 is enterprise security (64+ controls)
•FedRAMP costs $250K-$1M+ and takes 12-24 months; SOC 2 costs $15K-$100K and takes 3-6 months
•FedRAMP required for federal agencies; SOC 2 required by 80%+ of US enterprises
•FedRAMP includes SOC 2-level controls plus extensive federal requirements
•Many companies get SOC 2 first, then pursue FedRAMP for federal market access

FedRAMP and SOC 2 represent two vastly different levels of security compliance. FedRAMP (Federal Risk and Authorization Management Program) is a rigorous federal authorization program with 325+ controls required for cloud service providers serving US government agencies. SOC 2 is a commercial attestation framework with 64+ controls designed for enterprise SaaS companies.

FedRAMP, managed by the US General Services Administration (GSA), ensures cloud products meet stringent federal security standards based on NIST SP 800-53. SOC 2, created by the American Institute of CPAs (AICPA), validates that service organizations implement security controls based on Trust Service Criteria.

This comprehensive guide compares FedRAMP and SOC 2 across requirements, costs, timelines, authorization levels, and strategic considerations to help you determine which framework your organization needs to pursue.

Aspect	FedRAMP	SOC 2
Governing Body	US Government (GSA)	AICPA (Private sector)
Number of Controls	325+ controls (NIST 800-53)	64+ common controls
Authorization Levels	Low, Moderate, High, LI-SaaS	Type I or Type II
Timeline	12-24 months (Moderate)	3-6 months (Type II)
Total Cost	$250K-$1M+ (Moderate)	$15K-$100K (Type II)
Auditor Requirements	FedRAMP-accredited 3PAO	CPA firm
Continuous Monitoring	Monthly POA&M updates, annual assessments	Annual renewal
Primary Use Case	Federal agency contracts	US enterprise customers
Public Listing	FedRAMP Marketplace	Private report sharing

Detailed Framework Comparison

Origin & Purpose

FedRAMP

Launched in 2011 by the US General Services Administration (GSA), FedRAMP standardizes security assessment and authorization for cloud products used by federal agencies. It's based on NIST SP 800-53 controls and ensures government data is protected according to federal standards.

✓Mandatory for cloud services serving federal agencies
✓Standardizes "do once, use many times" approach across 100+ agencies
✓Protects Controlled Unclassified Information (CUI) and federal data
✓Listed on public FedRAMP Marketplace for federal procurement

SOC 2

Created by the American Institute of Certified Public Accountants (AICPA) in 2010, SOC 2 is a voluntary compliance framework for service organizations processing customer data. It's designed to validate security, availability, and privacy controls for commercial enterprises.

✓Required by 80%+ of US enterprise procurement teams
✓Standard for SaaS, cloud services, and data processors
✓Private attestation report shared selectively with customers
✓Flexible criteria selection based on business model

Control Structure & Requirements

FedRAMP

FedRAMP requires implementing NIST SP 800-53 controls across 18 control families with three impact levels:

Low Impact: 125 controls (publicly available data)
Moderate Impact: 325 controls (most common, CUI data)
High Impact: 421 controls (mission-critical systems)
LI-SaaS: 133 controls (low-risk SaaS applications)

Control families include Access Control, Audit & Accountability, Configuration Management, Incident Response, Risk Assessment, System & Communications Protection, and 12 more.

SOC 2

SOC 2 is based on five Trust Service Criteria (TSC) with 64+ common controls:

• Security (required): Access controls, encryption, monitoring
• Availability: System uptime, disaster recovery
• Processing Integrity: Accurate, authorized processing
• Confidentiality: Data protection beyond security
• Privacy: PII handling and consent

Security is mandatory; other criteria are optional. Most SaaS companies pursue Security + Availability.

Authorization & Audit Process

FedRAMP

Phase 1: Preparation (6-12 months)

• System Security Plan (SSP) development (1,000+ pages)
• FedRAMP-accredited 3PAO selection
• Security control implementation
• Continuous monitoring setup

Phase 2: Assessment (3-6 months)

• 3PAO conducts Security Assessment Report (SAR)
• Plan of Action & Milestones (POA&M) for findings
• Agency or JAB authorization decision
• FedRAMP PMO review (2-3 months)

Phase 3: Continuous Monitoring

• Monthly POA&M updates to FedRAMP PMO
• Annual 3PAO assessments
• Vulnerability scanning and patching tracking

SOC 2

Phase 1: Readiness (2-3 months)

• Gap analysis against TSC
• Policy creation (20+ policies)
• Control implementation
• Evidence collection setup

Phase 2: Type I Audit (1 month)

• Point-in-time control design review
• Sampling and testing
• Report issuance (2-4 weeks)

Phase 3: Type II Audit (6-12 months)

• Operating effectiveness testing
• Quarterly evidence collection
• Final audit and report
• Annual renewal thereafter

Cost Comparison

FedRAMP Total Cost (Moderate)

3PAO Assessment$150K-$500K

Compliance Platform/Tools$50K-$150K

Consultant/Advisory$100K-$300K

Infrastructure upgrades$50K-$200K

Annual Assessment (ongoing)$75K-$200K/yr

Year 1 Total$400K-$1.35M

SOC 2 Total Cost

Type I Audit$15K-$30K

Type II Audit$20K-$100K

Compliance Platform (annual)$5K-$30K

Consultant/Advisory (optional)$10K-$50K

Annual Renewal$25K-$100K/yr

Year 1 Total (Type II)$50K-$210K

Cost Note: FedRAMP costs are 5-10x higher than SOC 2 due to extensive documentation, federal auditor requirements, continuous monitoring, and infrastructure investments. LI-SaaS level reduces costs by 40-60%.

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FedRAMP Authorization Levels Explained

FedRAMP offers multiple authorization levels based on data sensitivity and system impact. Understanding these levels is critical for choosing the right path:

Low Impact (125 controls)

Use case: Systems processing publicly available data with minimal impact if compromised

Examples: Public information systems, general communication tools

Moderate Impact (325 controls)

Most Common

Use case: Systems processing Controlled Unclassified Information (CUI) - 90%+ of FedRAMP authorizations

Examples: Email systems, collaboration tools, HR platforms, financial systems, most SaaS applications

High Impact (421 controls)

Use case: Mission-critical systems where compromise could have catastrophic impact

Examples: National security systems, emergency response, law enforcement, critical infrastructure

LI-SaaS (133 controls)

Newer Path

Use case: Low-risk SaaS applications with limited data types (introduced 2022)

Examples: Productivity tools, training platforms, simple workflow automation

Authorization Paths

→Agency Authorization: Sponsored by specific federal agency (faster, 9-15 months)
→JAB Authorization: Joint Authorization Board (Department of Defense, DHS, GSA) - gold standard but slower (18-24 months)
→FedRAMP Marketplace: Both paths result in public listing for federal procurement

Control Overlap: FedRAMP Includes SOC 2

FedRAMP Moderate includes all SOC 2 controls plus extensive federal requirements. This means FedRAMP-authorized systems automatically satisfy SOC 2 security and availability requirements:

Controls in Both Frameworks

✓Multi-factor authentication (MFA)
✓Encryption in transit and at rest
✓Role-based access control (RBAC)
✓Security awareness training
✓Incident response procedures
✓Vulnerability scanning and patching
✓Backup and disaster recovery
✓Change management

FedRAMP-Specific Requirements

+1,000+ page System Security Plan (SSP)
+FIPS 140-2 validated encryption modules
+PIV/CAC support for federal user authentication
+US-based data centers and personnel requirements
+Monthly POA&M reporting to FedRAMP PMO
+Extensive configuration management and change control
+Supply chain risk management (SCRM)
+Continuous monitoring and automated scanning

Strategic Approach: SOC 2 First, Then FedRAMP

Most companies follow this progression to minimize risk and cost:

1.Get SOC 2 Type II first (3-6 months, $50K-$100K) to serve commercial customers
2.Validate market demand for federal contracts before investing in FedRAMP
3.Pursue FedRAMP authorization (12-24 months, $400K-$1M+) when you have agency sponsor
4.Leverage existing SOC 2 controls to accelerate FedRAMP readiness by 30-40%

Which Should You Choose?

Choose FedRAMP if you:

✓Have committed contracts or strong pipeline with federal agencies
✓Are pursuing Department of Defense, DHS, GSA, or civilian agency contracts
✓Process Controlled Unclassified Information (CUI) or federal data
✓Have $500K-$1M+ budget for initial authorization and ongoing compliance
✓Can commit 12-24 months to authorization process
✓Have agency sponsor or clear path to JAB authorization
✓Want competitive differentiation in federal marketplace (300+ authorized services)

Choose SOC 2 if you:

✓Sell primarily to US commercial enterprises (not federal agencies)
✓Face procurement blockers from enterprise buyers requiring SOC 2
✓Are a SaaS, cloud service, or data processor without federal customer base
✓Need faster time to market (3-6 months vs 12-24 months)
✓Have limited budget ($50K-$100K vs $500K-$1M+)
✓Want private attestation reports shared selectively with customers
✓Prefer annual renewal cycle vs continuous federal monitoring

Choose BOTH (Sequential) if you:

✓Serve both commercial enterprises and federal agencies
✓Want to start with SOC 2 for commercial validation, then add FedRAMP for federal expansion
✓Can leverage SOC 2 controls to accelerate FedRAMP readiness
✓Have multi-year compliance roadmap and budget for phased approach
✓Want maximum market coverage across commercial and government sectors

Key Takeaways

1
FedRAMP is significantly more rigorous: 325+ controls vs 64 controls, $500K-$1M+ vs $50K-$100K, 12-24 months vs 3-6 months.
2
FedRAMP requires agency sponsor: You cannot pursue FedRAMP without committed federal customer or Joint Authorization Board (JAB) path.
3
SOC 2 is prerequisite for most companies: 80%+ of US enterprises require SOC 2 for procurement. Get this first unless you have clear federal demand.
4
Control overlap exists but limited: FedRAMP includes SOC 2 controls but adds 250+ federal-specific requirements. Expect 30-40% acceleration if you have SOC 2.
5
Sequential approach is most common: SOC 2 first (commercial validation), then FedRAMP (federal expansion) when you have committed agency sponsor.

Frequently Asked Questions

Can I get FedRAMP without SOC 2?

Yes, but it's not recommended. While SOC 2 is not required for FedRAMP, having SOC 2 first validates your security program, demonstrates operational maturity, and provides 30-40% control overlap that accelerates FedRAMP readiness. Most successful FedRAMP vendors have SOC 2.

How do I find a FedRAMP agency sponsor?

Agency sponsorship requires an active contract or strong commitment from a federal agency. Start by engaging with agency IT security and procurement teams, demonstrating SOC 2 compliance, and showing alignment with agency mission needs. Alternatively, pursue JAB authorization (more rigorous but broader recognition) or start with FedRAMP Ready designation.

What is FedRAMP LI-SaaS and should I consider it?

FedRAMP LI-SaaS (Low Impact Software-as-a-Service) is a newer authorization level introduced in 2022 with 133 controls (vs 325 Moderate). It's designed for low-risk SaaS applications with limited data types. Consider LI-SaaS if your application processes minimal federal data and you want faster, cheaper authorization. However, many agencies still require Moderate.

Does FedRAMP eliminate the need for SOC 2?

Not entirely. While FedRAMP includes all SOC 2 controls, commercial enterprise customers still expect SOC 2 Type II reports. FedRAMP documentation (SSP, SAR) is not designed for commercial sharing. Most FedRAMP-authorized vendors maintain both: FedRAMP for federal agencies and SOC 2 for commercial customers.

How much does FedRAMP continuous monitoring cost annually?

FedRAMP continuous monitoring costs $75K-$200K+ annually, including: annual 3PAO assessments ($50K-$150K), monthly POA&M management, vulnerability scanning, security tooling, and dedicated compliance staff (1-2 FTEs). This is significantly higher than SOC 2 annual renewal ($25K-$100K).

Can foreign companies get FedRAMP authorization?

Yes, but with restrictions. FedRAMP requires US-based data centers for CUI storage and may require US citizen personnel for certain roles. Foreign companies can pursue FedRAMP by establishing US subsidiaries, using US-based infrastructure, and meeting personnel requirements. Agency sponsorship is still required.