// GLOSSARY -- SECURITY & COMPLIANCE
What is a Financial Guardrail?
Any mechanism preventing AI agents from causing financial harm — spending controls, budget limits, recipient restrictions, velocity monitoring, circuit breakers, and kill switches.
WHY IT MATTERS
While guardrails broadly cover safety, financial guardrails specifically address monetary loss — the most consequential because mistakes are measured in real money.
Operate at multiple levels: prevention (limits block), detection (monitoring identifies), response (breakers halt), recovery (audit trails analyze).
Must be layered — no single mechanism catches everything.
HOW POLICYLAYER USES THIS
PolicyLayer is the definitive financial guardrail layer — prevention, detection, response, and recovery in one platform.
FREQUENTLY ASKED QUESTIONS
What's the minimum set?
Per-transaction limit, daily cap, recipient allowlist, and kill switch. These four cover the most common threat vectors.
Can guardrails be too strict?
Yes — overly restrictive guardrails prevent agents from doing useful work. The art is calibrating to the risk level while enabling productivity.
How do guardrails interact?
Layered evaluation. A transaction must pass ALL guardrails — amount limit AND allowlist AND velocity check. Any failure blocks the transaction.