Is Your Small Business at Risk of a Data Breach?

Data breaches are no longer just a concern for large corporations; small businesses are increasingly becoming targets. If your business handles customer data in any capacity, it’s crucial to understand your responsibilities and take steps to protect your information from potential threats. Here are some essential actions you can take to safeguard your business and your customer data.

1. Understand the Risks

To protect your business from cyber threats, it’s important to be aware of the risks you face. In the 2023-24 financial year, the Australian Cyber Security Centre reported that a cybercrime occurred every seven minutes on average. For small businesses, the average cost of a cybercrime was around $49,000.

Common cybercrimes affecting small businesses include email compromise (20%), online banking fraud (13%), and business email compromise (13%). Recognizing these threats is the first step toward prevention.

Action: Take some time to assess your business’s cyber risks by using the security checklist available on Business.gov.au. Pay special attention to your internet security and follow recommended steps to secure your network.

2. Know Your Obligations

Protecting personal data is crucial, but not all small businesses are automatically covered by the Privacy Act 1988. Some businesses can opt-in for coverage, which shows your customers that you are serious about their privacy.

Depending on your business type, you may also need to comply with specific privacy regulations, such as the Australian Privacy Principles (APPs), consumer credit information laws, or tax file number guidelines.

Action: Use the Office of the Australian Information Commissioner’s (OAIC) Privacy Checklist for Small Business to assess your obligations and determine if you need to opt-in for Privacy Act compliance.

3. Know What Data You Can and Can’t Collect

It’s vital to only collect the personal information that is necessary for your business. Avoid collecting data “just in case” it might be useful later. The OAIC recommends collecting only the data you need at the time.

Be aware of sensitive information, such as racial or ethnic origins, health details, and sexual orientation, which can only be collected with explicit consent.

Action: Review OAIC guidelines on handling personal information and ensure you are collecting only what is necessary for your business.

4. Store Your Data Safely

Once you collect personal data, it’s your responsibility to keep it secure from unauthorized access or misuse. When data is no longer needed, you must take steps to destroy or de-identify it to prevent any potential harm.

Action: Familiarize yourself with the OAIC Guide to Securing Personal Information to ensure you are taking the proper steps to protect stored data.

5. Protect Your Data and Systems

Keeping your systems and software up-to-date is one of the most effective ways to protect against cyber threats. This includes updating devices and cloud-based storage systems. Enabling automatic updates for your devices and software is a good start.

Another important security measure is multi-factor authentication (MFA). MFA adds an extra layer of security by requiring users to provide more than one form of verification, such as a one-time code sent to a mobile device.

Action: Implement MFA and follow cybersecurity best practices outlined by the Australian Cyber Security Centre to protect your systems.

6. Know What to Do in Case of a Data Breach

In the event of a data breach, your business is required to notify affected customers under the Notifiable Data Breaches scheme. Acting quickly can help minimize the damage and protect both your business and your customers.

Having a data breach response plan is as important as having an emergency evacuation plan for your physical premises.

Action: Create a data breach response plan by using the OAIC’s Data Breach Preparation and Response guide to help you prepare for any incidents.

7. Take Advantage of Available Resources

The Australian Cyber Security Centre and the OAIC provide a wealth of resources to help businesses manage privacy and data security risks. Take advantage of these free tools to ensure that your business is prepared to handle data and privacy challenges.

Action: Explore the OAIC’s resources and consider training your staff on privacy obligations to keep your business compliant and secure.

Conclusion

Data security is a growing concern for small businesses, but by understanding the risks and taking proactive measures, you can protect both your business and your customers. Start by reviewing your data security practices, stay informed about your obligations, and implement security measures to mitigate risks. By doing so, you’ll build trust with your customers and safeguard your business from potential data breaches.