Does your firm have an up-to-date cybersecurity strategy that includes encryption?
Many entrepreneurs assume that their company isn’t big enough to attract the notice of hackers – but this is a major misconception. Companies of all sizes are at risk of data breaches, and small businesses are increasingly a favorite target. And when hackers strike, the consequences can be disastrous: a recent study found that 60% of small businesses that are hacked go out of business within six months.
No matter what industry you’re in, you almost certainly handle sensitive data – like your employees’ Social Security numbers, your customers’ credit card information, and your own bank account details. Encryption technology can limit the fallout from a cyberattack by making this data unusable to the perpetrators, even if they manage to gain access to your devices or systems. If you haven’t looked into data encryption for your company, now’s the time.
What is Encryption?
If you’ve ever gotten a magic decoder ring in a cereal box or used a substitution cipher (like A = 1, B = 2, C = 3) to write a secret message to a friend, you have experience with basic data encryption.
In the computing world, highly sophisticated algorithms are used to convert plain text into cipher text that requires a unique key to read. You can encrypt individual pieces of information, whole files, or an entire hard drive. To any unauthorized user, the data will just look like a random jumble of characters. For example, here’s what a credit card number looks like once it’s been encrypted with an NSA-approved cipher:
Good luck to any cyberthief who tries to figure that one out! Meanwhile, by entering a password or inserting a USB device, you or any authorized user can instantly access the decoded data.
Here are a few specific reasons that you should consider adopting data encryption technology:
1. Limit the cost of a lost device. If a laptop goes missing on a business trip or a smartphone is swiped off someone’s desk at the office, you might have to pay to replace it. But better to lose $1,000 than to lose $50,000 – which one study estimates is the average cost of a lost business device with sensitive data on it.
2. Foil ransomware attacks. As we discussed in previous posts, this is a growing form of cybercrime in which important files are stolen and held for ransom – and perpetrators can demand extra by threatening to release sensitive data to the public. If your files are backed up and encrypted, you won’t have to give in to extortion.
3. Defend against corporate espionage. While personal and financial info is most vulnerable to theft, even smaller enterprises shouldn’t discount the value of their intellectual property like business plans, designs, formulas, and vendor lists. Encryption can ensure that trade secrets won’t fall into your competitors’ hands.
4. Keep your remote workers secure. Cybercrime has grown apace with the increase in telecommuting. It’s great to give your team the flexibility to work from home or on the go, but remote desktop tools and unsecured public Wi-Fi networks are an invitation to hackers. Data encryption can be a vital second line of defense.
5. Preserve your reputation. Hackers can sell Social Security numbers on the dark web, put charges on credit cards, and even clean out bank accounts, but the costliest aspect of a major data breach could be the resulting PR crisis. A business that fails to protect customer and vendor data will likely lose the public’s trust.
A Business Partner You Can Trust
Ready to take your business to the next level? Consider Nu Direction. As a small business lender owned by not-for-profit credit unions, we can bring you the speed of fintech with the spirit of community lending. Eligible businesses can receive affordable loans ranging from $25,000 to $500,000 with funding in as little as one week. Plus: no application fee, no yield maintenance, and no repayment penalty. Learn more today!
The information contained herein is for general informational purposes only and does not constitute tax, legal, or business advice.
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Nu Direction Lending is a digital-first business lender that was formed and is funded by credit unions. We combine the speed and convenience of online lenders with the personalized touch of the local credit unions who help fuel our local economies.