Protecting customer data – data protection tools, techniques, and tips

Protecting customer data should be a top priority regardless of the size of your business or customer base.

UK businesses experience a large number of cyber attacks.

According to the 2022 Cyber Security Breaches Survey for the Department for Digital, Culture, Media & Sport, 39% of UK businesses identified cyber attacks; the most common of which being phishing attempts (83%).

Of the businesses attacked, just under one-third (31%) reported receiving cyber attacks at least once a week, highlighting the need for data security measures.

If a cyber attack targeting customer data is successful, businesses may lose customers, industry reputation, brand trust, and could even face fines or penalties by the Information Commissioners Office (ICO).

Being a smaller business doesn't mean you're exempt from data protection requirements such as the Data Protection Act and UK GDPR.

Learn more about the Data Protection Act 2018 and UK GDPR and how to comply with them.

Understanding customer data

Customer data is any information provided to a company from its customers that is first-party collected and stored for business purposes.

Customer data can typically fall into one of three categories:

• contact data - includes email addresses, home addresses, phone numbers, and emergency contacts
• personal data - name, age, gender, sexuality, religion, medical history, race
• financial data includes credit card details, credit scores, purchase histories, and debt records.

Customer data can analyse customer behaviour and patterns that can help inform a company's sales and marketing strategies.

As much of this information can be considered sensitive, it is vital to ensure that you have suitable safeguards to protect that data from criminals.

Read our guide on how cloud computing can help your business protect customer data.

How is customer data protected?

UK GDPR is the UK’s implementation of the General Data Protection Regulation (GDPR), which means all UK businesses are required by law to secure their customers' data and to follow a number of data protection principles.

Sensitive personal data, like race, religion and health status, are subject to even stronger legal protections.

However, if your business works in Europe, your business must follow the European General Data Protection Regulations (GDPR) and DPA regulations.

These principles and regulations guide businesses in handling customer data, including, amongst others, how to collect and store it, how long it can be kept, and what it can be used for.

How can smaller businesses protect customer data?

Understand data lifecycles

A data lifecycle is the time between the moment you collect the data to when the data is no longer needed.

The length of time depends on the type of data you are storing and how long you need the data.

Storing too much data for too long could increase the risk of insecure storage and breaches; to avoid this, consider creating a policy with a cut-off period for data storage and delete data when it is no longer required or after a specified amount of time.

Data backups

Regularly backing up data could be a good way to keep customer data secure and protect it in case of a security breach or accident, such as flooding or fire.

Secure backup data on an external device, such as an external hard drive, and then secure the device in a lockable container.

You can consider using dedicated data back-up services but ensure that you are clear where the data is stored, how it is processed, and that the back-up service adheres to DPA and GDPR regulations.

Restrict access to data

A simple way to approach data protection is to restrict who has access to customer data.

In theory, the fewer people who can access the data, the less risk there is of it being compromised.

For example, you could ensure that data is encrypted and protected by passwords.

Only provide passwords and access to the data to necessary employees that are using it exclusively to carry out the tasks for which the data is collected  and consent given.

You could consider keeping automatic logs of who accesses data and revoking data access once an employee or service provider leaves your company or takes an extended absence.

Encryption

For maximum security, it could be worth encrypting your customers' data.

This could be as basic as setting an access password to more complex methods, such as using specialist software and authentication hardware.

The point of encryption is to act as an additional defence against unauthorised data access.

For example, if your laptop is stolen and it has customer data stored on it, the thieves could potentially be able to access the data on it.

Combining encryption with several other data security measures means that even if the same laptop was stolen it would be harder to criminals to decrypt and access the stored data.

Device security

It could be worth taking a two-pronged approach to customer data security for additional data security.

Not only could you consider securing the data inside a device, but also the device itself.

Keeping devices that hold data, such as mobiles, laptops, and hard drives, in secure and lockable storage could be another way to help reduce the risk.

It could also be a good idea to consider only using secure Wi-Fi connections and tools such as virtual private networks (VPNs) when working in public spaces to increase security.

Read our guide on how to protect your smaller business from cyber attacks.

Use security tools

Security tools such as firewalls, anti-virus software, VPNs, and two-factor authentication are all methods businesses use to help protect customer data.

All these tools can provide additional security for your customer data, making it harder for hackers and thieves to access it or even discourage them from attempting to try.

Educate staff on data security

Your employees are the first line of defence when protecting customer data, as employee errors can cause serious issues, such as a data breach.

Many data breaches are the result of social engineering attacks, such as phishing emails, that attempt to trick an employee into sharing passwords or providing access to company networks.

Educating staff on what various cyberattacks look like, how to handle them, and your company's policies can help reduce the risk of them falling for a scam and compromising your customers' data.

Read our guide on how employee training can help your business.