As a business owner, protecting your customer’s sensitive information is of the utmost importance. However, providing a fool-proof data security system for your network isn’t always feasible, because these types of systems can be costly, along with being difficult to setup and maintain. However, not spending the time and money to protect your information can put you out of business if hackers can get the information. When evaluating your company’s data security systems, here are the top four impacts a data breach could have on your company.
Damaged Reputation
New Report: Businesses Suffer Serious, Measurable Damage From Data Breaches
Losing the trust of your customers and stakeholders can be the most harmful impact of a cybersecurity breach. This is due to the fact that a majority of people will no longer do business with a company that has experienced a data breach, especially if the company failed to protect customer data.
This results in a loss of business, as well as the weakening of your brand. In fact, according to a study conducted by the InfoSec Institute, one in ten companies had to change the nature of their business to restore their reputation after a data breach.
Theft
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Due to the less sophisticated security defenses of smaller businesses, they become a softer target for hackers. Not only does cyber-enabled fraud lead to monetary losses for a company, but it can also result in stolen data and intellectual property. This data can be more valuable to hackers, primarily when they sell it on the Dark Web. One way to help decrease the chances of your company’s sensitive data from being stolen is by adopting ways to control your file transfer of customer information.
Financial Losses
Yahoo Says Hackers Stole Data on 500 Million Users in 2014
According to Corporate Information Technologies, the average cost of a data breach for a small business is $665,000, with larger enterprises incurring more than $7 million in damages. The costs that small businesses suffer as a result of cybersecurity breaches are disproportionately more than big companies. By taking a casual stance on data security, and not taking the proper steps to ensure your data is secure can quickly put you out of business.
Fines
Equifax hack: 44 million Britons’ personal details feared stolen in major US data breach
Along with the direct financial losses that your business will suffer, you may end up facing monetary penalties for failing to comply with data protection laws. Authorities around the globe have begun to consider implementing stricter regulations on companies who fail to protect their customer’s sensitive data. The European Parliament has proposed a fine of 20 million euros be assessed on any company whose customers’ information is compromised due to a data breach. This is a sum that would threaten the solvency of many growing businesses.
Cybersecurity is an increasingly important aspect of any business. With sensitive customer and company data within easy reach of hackers, it is essential to evaluate your current data security system and make any updates that are necessary. Don’t put your business at risk. Adopt a comprehensive security strategy to help you avoid a potentially devastating security breach, resulting in the loss of the company you’ve work hard to build.