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4 Data Room Security Measures to Protect Your Business Data

2 Mins read
  • All businesses need to make sure that their data rooms are safeguarded against hackers.

Did you know that 60% of businesses fail within six months of a data breach? You need to take serious measures to protect your data from being hacked.

Businesses usually have a vast amount of sensitive and confidential data that needs to be handled effectively. This is why it is essential to have a business data privacy strategy. This can range from sensitive financial records to intellectual property. That’s why securing this data against cyber threats and unauthorized access is of utmost importance. 

In recent years, Virtual Data Rooms (VDRs) have emerged as a powerful solution to safeguard critical data during high-stakes transactions like mergers and acquisitions, fundraising, and due diligence. 

This blog explores four essential security measures virtual data rooms employ to protect your business data and ensure a secure environment for collaborative information sharing. 

1. Encryption

Virtual data rooms use encryption to protect data both in transit and rest state. There are many robust encryption algorithms used by VDRs to encode the data so it is unreadable to anyone without the encryption keys. 

When data is transferred over the internet or stored on servers, it is encrypted to discourage interception attempts by hackers. Furthermore, end-to-end encryption ensures that only authorized parties can access the information. 

This approach significantly reduces the risk of unauthorized access to your business’s sensitive information and should be in place for every business, just as video security systems. 

2. Two-Factor Authentication (2FA)

Two-Factor Authentication (2FA) is an additional layer of security that reinforces user authentication in virtual data rooms. When your data is protected by two-factor authentication, you will have to provide two separate verification factors before gaining access to the data. 

Most of the time, these two factors include a password and a code sent to your mobile device to confirm your identity. This approach significantly reduces the chances of unauthorized access, even if login credentials are compromised, adding an extra barrier that ensures only legitimate users can enter the data room. 

If you want to know more about two-factor authentication and how a reliable data room uses it to protect your information, you can Learn more about a data room so you can decide if it is a good choice for protecting your important data. 

3. Access Control

Access control is a crucial security mechanism in virtual data rooms that allows administrators to manage user permissions effectively. In this approach, admins define user roles and access levels to grant or revoke privileges based on users’ needs and responsibilities. 

This prevents unauthorized users from accessing sensitive information and ensures that only authorized personnel can view, download, or modify documents. The best part is that you can also adjust the access control as soon as a new employee is added to or leaves your team. 

4. Watermarking and Access Tracking

Watermarking is a unique security feature used in virtual data rooms to deter information leaks and unauthorized sharing. When a user views or downloads a document, the VDR automatically adds a dynamic watermark containing the user’s identity and the date of access. 

This measure ultimately discourages users from saving the information and taking screenshots or photographs of sensitive information, as their identity is linked to each file. 

Moreover, admins can monitor user activity within the data room to enable the detection of suspicious behavior and potential data breaches in real time. This ultimately reduces the risk of data being mishandled or shared outside the authorized environment. 

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About author
Ryan Kh is a big data and analytic expert, marketing digital products on Amazon's Envato. He is not just passionate about latest buzz and tech stuff but in fact he's totally into it. Follow Ryan’s daily posts on Catalyst For Business.
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