MCP for Regulated Industries
Adopting the Model Context Protocol in banking, healthcare or the public sector means meeting constraints a single-developer setup never faces: data cannot leave the perimeter, identity must be strong and centrally managed, and every action must be provable to an auditor. MCP itself is a good fit for these environments — but only when the layer that fronts it enforces the controls regulators expect.
Data residency and no egress
The defining rule in regulated work is that regulated data stays put. Patient records, account data and citizen information often cannot cross a network boundary, a cloud region or a national border. That makes self-hosting the natural deployment model: run the MCP gateway and its upstream servers inside your own network, so tool calls, arguments, results and logs never transit a third party. "The information cannot leave the building" stops being a slogan and becomes an architectural guarantee — there is no external endpoint in the path to leak to.
Strong identity and least privilege
Regulated organizations already run corporate identity, and MCP access must plug into it rather than invent its own logins. That means SSO via SAML or OIDC, automated provisioning and deprovisioning through SCIM, and RBAC so access maps to roles, teams and entitlements. On top of identity sits least privilege: each user, team and agent reaches only the specific servers and tools their job requires, and nothing more. When someone leaves or changes roles, SCIM revokes access automatically — no orphaned credentials pointing at sensitive systems.
Data protection and separation of duties
Two controls come up in nearly every audit. PII redaction strips personal and sensitive data out of tool arguments and results before they are logged or returned to a model, so regulated fields never leak into a transcript. Separation of duties — implemented as maker-checker approvals — ensures that high-impact actions require a second person to sign off, so no single individual can move money, change a record or trigger a sensitive tool alone. Together they address the two questions auditors ask most: who could see the data, and who could act on it unilaterally.
Tamper-evident audit and key custody
Compliance rests on proof. A tamper-evident audit trail records every tool call, policy decision and approval in an append-only log an auditor can trust, letting you reconstruct exactly what an agent did and who authorized it. Cryptographic material is held to the same standard: keys and secrets live in a KMS or HSM rather than in application config, so custody, rotation and access are controlled and logged independently of the application.
A signed, attested supply chain
Regulators increasingly ask what software you are actually running. A software bill of materials (SBOM) enumerates every dependency, and signed container images (for example with cosign) let you verify that what you deployed is what the vendor built, untampered. This closes the supply-chain gap — you can attest the provenance of the gateway itself, not just the traffic flowing through it.
How Kravn fits
Kravn is designed for exactly these constraints: a self-hostable MCP gateway where no data leaves your perimeter, integrated with SSO (SAML/OIDC), SCIM and RBAC, with PII redaction, maker-checker separation-of-duties approvals, a tamper-evident audit trail, KMS/HSM key management and SBOM plus cosign-signed images. It is source-available under BSL 1.1, so you can inspect what you run. See MCP for Regulated Industries in practice and Running MCP On-Premise.