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Data is increasingly valuable to businesses, especially the ones related to customers, and payments and data breaches are at times difficult to avoid as well as difficult to digest.
FREMONT, CA: The data businesses rely on to serve their customers better is also an easy target for the criminals to use fraudulently. That poses a mark on the back of the companies that accept credit and debit card payments. According to a study, it was discovered that the average cost of a data breach was $3.86 million globally, a 6.4 percent increase over 2017. Small business owners have to ac to the consequences of a data breach to evaluate the risks properly. These businesses generally mistakenly believe that they are too small to be on a criminal's radar and don't prepare. This lack of preparation creates vulnerabilities for criminals to exploit. Running of a small business demands understanding, anticipation, and guardianship against risk. Knowledge of the risk requires a clear-eyed view of the consequences of a data breach.
The short-term consequences
The instant consequences of a data breach are less known, but it can be very damaging for the bottom line.
1. Direct fines and fees: Fines and penalties are charged by The Payment Card Industry Security Standards Council as a result of a data breach. Additional fines will differ but may come from both regulatory agencies and card network brands.
2. Forensic investigations: The businesses that were attacked will be responsible for performing a forensic investigation to determine the causes of the data breach. These investigations generally produce valuable evidence and insights that help prevent future data breaches.
3. Future security costs: Businesses that are a victim of a data breach may incur expenses related to mandatory credit monitoring for customers whose data was compromised. Those efforts might include identity theft repair, the costs of card replacement, and additional compliance requirements.
The most significant long-term impact of a data breach is the loss of customer trust. A good reputation is a company's most valuable asset as a business must continuously work to build and maintain its brand integrity. The customers share their sensitive information with businesses assuming that they will have proper security measures to protect their data.
However, businesses can recover from the consequences of a data breach. The loss of trust and diminished reputations that data breaches cause can be measured directly on your bottom line. Understanding the implications of a data breach is an essential first step on the road to safeguarding your business. The next step is creating an action plan so you can protect what you've worked so hard to earn.
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