A new report from the Federation of Small Businesses (FSB) has found that small firms are unfairly carrying the cost of cyber crime in an increasingly vulnerable digital economy.
The report, ‘Cyber Resilience: How to protect small firms in the digital economy,’ suggests smaller firms are collectively attacked seven million times per year, costing the UK economy an estimated £5.26 billion.
Despite the vast majority of small firms (93%) taking steps to protect their business from digital threats, two thirds (66%) have been a victim of cyber crime in the last two years. Over that period, those affected have been victims on four occasions on average, costing each business almost £3000 in total.
Cyber crime costs small businesses disproportionately more than big businesses when adjusted for organisational size. Currently the responsibility largely falls on small businesses to protect themselves . FSB is calling for more support to be given to those smaller firms least able to bear the burden of the increasing global cyber threat.
Almost all (99%) of the UK’s 5.4 million small firms rate the internet as being highly important to their business, with two in three (66%) offering, or planning to offer, goods and services online. Without intervention, the growing sophistication of cyber attacks could stifle small business growth and in the worst cases close them down.
The types of cyber crime most commonly affecting small businesses are phishing emails (49%), spear phishing emails (37%), and malware attacks (29%).
Small firms are also concerned about hacking and fraud when the card is not present, with the average information breach setting them back 2.2 days.
To combat this, four in five small firms (80%) use computer securing software, and well over half (53%) perform regular updates of their IT systems.
The FSB report also found room for small firms to improve security. Currently just a quarter of smaller businesses (24%) have a strict password policy, four per cent have a written plan of what to do if attacked online, and just two per cent have a recognised security standard such as ISO27001 or the Government’s Cyber Essentials scheme.
Mike Cherry, FSB National Chairman, said:
“The digital economy is vital to small businesses – presenting a huge opportunity to reach new markets and customers – but these benefits are matched by the risk of opportunities for criminals to attack businesses.
Small firms take their cyber security responsibility very seriously but often they are the least able to bear the cost of doing so. Smaller businesses have limited resources, time and expertise to deal with ever-evolving and increasing digital attacks. We’re calling on Government, larger businesses, individuals and providers to take part in a joint effort to tackle cyber crime and improve business resilience.”