The importance of compliance in a company’s lifespan and overall strategy cannot be overstated.
Getting compliant with data protection laws and regulations as soon as possible is vital for startups, particularly if data privacy and information security are core features of the company culture you’re trying to build. Managing compliance at the first opportunity not only comes with a number of both short-and-long-term benefits, but also helps your company avert disasters down the road.
By focusing on these data protection compliance laws upfront, startups can build a foundational culture based on privacy that can help your organization build trust with customers and get to market more quickly. Startups should go through the necessary steps to achieve compliance – for PCI, GDPR, SOC 2, or CCPA – as early as they can as a young company.
By starting off on the right foot and taking care of your compliance matters in the beginning, you will not only demonstrate your commitment to the privacy and safety of your valued customers - you’ll also instill an important security-first mindset into your employees and reduce the risk of costly data protection disasters in the future.
The importance of PCI compliance in business
These days, managing a startup involves coordinating a host of complex moving pieces and regulations – with data security compliance being one of the most high-risk concerns.
The importance of compliance in business highlights the fact that when a business works to comply with data security standards, they invest in a preventative measure against numerous threats.
When an incident happens, for example, unauthorized access leading to a data breach, there can be business-ending repercussions. Small-to-medium-sized organizations can be financially devastated by the financial compliance penalties and damage to brand reputation that follow a data leak resulting from cyberattacks like phishing campaigns or other types of incidents.
Merchants and service providers who decide not to comply with data protection standards open themselves up to these risks and the subsequent damage costs.
It’s not just early-stage companies that fall victim to data breaches because of a failure to comply with information security standards. Larger financial institutions, even some with some information security compliance measures in place, are at risk. Despite the fact that cyber- and network security have evolved dramatically in recent years, so have the tactics that cyber criminals employ to steal sensitive data. When even Face ID can be hacked, businesses can no longer run on older models of data protection.
That’s why it’s important to understand that data protection is a constantly ongoing and evolving process.
From T-Mobile to British Airways, cybercrime in the forms of highly-advanced malware and nearly-undetectable phishing attacks have even victimized large organizations with well-funded information security and compliance programs with robust data security policies.
After a series of high-profile data breaches and data-selling scandals that have gotten considerable media attention in the past few years, people are less trusting of how companies handle their sensitive personal information.
And being in full data security compliance with current regulations has become a priority for businesses who want to highlight that they put consumer safety first.
Today’s consumers understand the importance of compliance and simply demand a higher level of control, safety, and transparency when it comes to their personal data.They want to feel assured that their sensitive information is not at risk when they’re giving it out online.
Data privacy compliance in the modern age: CCPA, GDPR and beyond
Dealing with data privacy regulations and maintaining compliance is complex – but doing it at the last minute is even more difficult.
When organizations establish their data security rules, implement technologies, and handle the necessary audits and compliance certificates early in their company’s journey, they are generating a number of advantages. Some benefits of compliance in business include:
1. A culture of security from the onset: By ensuring everyone in an organization, as well as future team members, are all on the same page when it comes to data security policies, rules, processes, and practices, the company can be built on a foundational culture of security that makes achieving compliance easier. Training can make that a reality for your organization.
2. Future time and resources dedicated to business growth: After getting data privacy rules and processes in order and fulfilling the necessary compliance requirements with plans for ongoing, regular maintenance, business leaders can focus on further innovating their products or services, getting to market faster and expanding their enterprises.
3. Starting small is always easier: Getting all the moving pieces in sync for a company’s information security program is much simpler when there are fewer moving pieces – with scalability into the future being less burdensome to manage. A simpler system is easier to work with.
The DIY approach to regulatory compliance - and why it costs you more
Dealing with data privacy regulations and maintaining compliance is complex – but doing it at the last minute is even more difficult.
When organizations establish their data security rules, implement security technologies, and handle the necessary audits and compliance certificates early in their company’s journey, they are generating a number of advantages:
1. A culture of security from the onset: By ensuring everyone in an organization, as well as future team members, are all on the same page when it comes to data security policies and practices, the company can be built on a foundational culture of security that makes achieving compliance easier.
2. Future time and resources dedicated to business growth: After getting data privacy rules and practices in order and fulfilling the necessary compliance requirements with plans for ongoing, regular maintenance, business leaders can focus on further innovating their products or services, getting to market faster and expanding their enterprises.
3. Starting small is always easier: Getting all the moving pieces in sync for a company’s information security program is much simpler when there are fewer moving pieces – with scalability into the future being less burdensome to manage.
The DIY approach to regulatory compliance - and why it costs you more
When an early-stage organization collects, stores or transfers sensitive information like credit card numbers, contact information, health care information, passwords, phone numbers, and other personally identifiable information, their obligation is to find a way to extract the value from such data while also making sure it stays secure.
Doing so ensures – as much as possible – a safe and effective user experience, regulatory compliance, and that personal information is only seen by those who should see it.
But, should a company want to tackle their data regulatory compliance on their own and without any third-party assistance, the to-do list is extensive.
For each regulatory compliance regime, it is important that startups first determine any and all places that sensitive personal information may flow through data mapping. After establishing which databases and networks fall within scope of a compliance regulation, they must then take action to secure those locations.
Then, compliance teams must test, re-test, and verify all their data privacy controls before assembling an official, documented data protection rules and regulation policy that the entire organization must abide by.
Apart from designing their own data security policies, access control policies and company-wide practices, businesses must then train their team members regularly to make sure everyone is up to speed on the current rules and regulations. Moreover, regular testing, maintenance, and auditing will be necessary to ensure they remain legal and compliant.
Performing all these tasks to shore up a startup’s information security efforts can be nearly impossible for many early-stage companies. The fact is, most small businesses and startups lack the funding and expertise to approach regulatory compliance on their own.
Fortunately, there is an effective approach that requires minimal upfront investment and maximum protection from data breach risk – which also comes with certain built-in regulatory compliance certificates.
A better security and compliance solution for data protection
The importance of compliance in business is clear. So, how can early-stage fintech companies best approach organizing effective data privacy policies and fulfill their legal requirements as early as possible?
Without a well-trained compliance and information protection team working side-by-side, going the DIY route may prove unfeasible for many startups out there.
By working with a third-party data security partner for the processing of personal data, however, young organizations can offload the data privacy and regulatory compliance liability onto someone else – and not worry about sensitive data during its entire lifecycle.
VGS data processing solutions, once implemented, take care of all sensitive data collection, data transfer, and storage on a startup’s behalf, ensuring that no sensitive data passes through their business systems to avoid possession of such information altogether.
Thanks to VGS’ innovative data aliasing technology, sensitive information is redacted and replaced in real-time with a synthetic alias that allows businesses to still analyze and use the data just like they would normally.
By relying on VGS for the effective processing of personal data, descoping a startup’s databases and networks from applicable data protection laws, its leadership team can channel their financial and human capital toward what builds value for their organization and helps further develop their business.
Click here to learn about trying a free demo of VGS solutions.
