Small businesses recognize importance of data security, but lack formal plan for addressing

Today at a Visa-sponsored card security summit in Washington, D.C., the National Federation of Independent Business and Visa USA are announcing a partnership to help the nation’s small businesses develop stronger security practices, as new survey results show that many such companies use a “common sense” approach to protecting customer and employee information.

According to the new survey, small businesses recognize the importance their customers place on protecting their information (83 percent say it is very or extremely important to their customers). Moreover, some 87 percent believe that if customers saw how they handled their data, it would either affirm (48 percent) or strengthen (39 percent) the trust that customers put in their business. At least 84 percent of the businesses surveyed protect customer information through encryption or passwords. The survey defines small businesses as any company with 250 or fewer employees.

Although many small businesses are confident about their data-storage practices, their level of storing sensitive information may make them an increased target for data thieves, according to the survey. Specifically:

— 37 percent of card-accepting businesses store customer card numbers;
— 24 percent store customer Social Security Numbers;
— 28 percent store customer bank account numbers or copies of their checks;
— More than half (52%) of all small businesses keep at least one these sensitive pieces of information.

In some situations, business owners may not be fully aware that their systems are storing this highly sensitive information. Yet, it is exactly this sort of personal information that criminals seek in order to commit payment fraud.

Few small businesses have established data-security processes in place, the survey shows. Most small businesses (57 percent) do not see securing customer data as something that requires formal planning, and many (39 percent) say they rely on common sense to keep data safe. Most small businesses (61 percent) have never sought out information about how to properly handle and store customer information.