South African small businesses are particularly vulnerable to cyberattacks. This is because business owners are not taking the necessary precautions to protect their digital assets, often with dire financial consequences, says Steve Flynn, Sales and Marketing Director of ESET South Africa.
Despite the significant risks, SMEs seem reluctant to take the same digital preventative measures to secure their IT infrastructure as they would to protect their office equipment or company-owned vehicles.
Just as a business owner would not underinsure a tangible business asset such as a factory, SMEs should not leave their digital assets unlocked and in plain sight of criminals. In a business environment where every cent counts, preventative measures must be weighed against the costs of not having IT security protection in place. Threats are becoming more prevalent, as there is a rise in online activity and hybrid working across the globe and here in South Africa.
Secret password attacks increased by an alarming 104 percent in less than a year, according to ESET’s 2021 threat report. That equates to 55 billion new attacks detected in less than six months. The latest statistics make for sobering reading and underscore the high probability of South African businesses being targeted by sophisticated criminal networks. The sheer number of attacks means it’s a question of when, not if, a compromise is launched on any given business network, regardless of size.
Ransomware attacks are also on the rise with massive consequences for organisations of all sizes. Just one example is a supply-chain attack that leveraged software vulnerabilities in an organisation’s IT management system. This ransomware event was accompanied by a USD$70 million ultimatum to regain control of the company’s digital assets and operational control.
It’s much more challenging to steal something tangible given the apparent layers of physical security. Yet digital compromise occurs in a nano-second. The price-benefit analysis is obviously relative to the cost of digital business disruption. Unlike large corporates, with redundancy functions among staff and well-resourced IT departments to resolve issues, IT security breaches within a sole proprietor or SME can wreak havoc. Anxiety is compounded by a loss of production, potential loss of revenue and opportunity cost. Not to mention the worrying issue of online brand impersonation and mimicry.
Estimates suggest that more than half of businesses fail within six months after a hack, making this phenomenon a critical component of business survival and success. Worse still, 61 percent of all data breach victims are businesses with fewer than 1000 employees.
Even if one isn’t partaking in the cryptocurrency’s digital gold rush or navigating the dark web, those with sober internet habits can fall preytoa data breach. And the costs are significant. It is assumed that 10 million records can cost a business USD$50 million to digitally recover and resecure. This is without the longitudinal, compounded impact of trust erosion.
While regulations such as GDPR and POPIA in place to protect the consumer, accountability and responsibility rest on the organisations processing that data. This brings a new and more accountable perspective to the notion of customer service.
SMEs should consider partnering with a team dedicated to continuously improving products, designed to guard against and defeat the latest cyber risks. An ever-evolving threat can only be countered by an equally evolved framework of software countermeasures.