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How SMEs can manage the cost of GDPR

Small business owners have a new acronym to remember: GDPR. They should have little problem in doing so because the General Data Protection Regulation comes with a price tag. Alternative finance can help SMEs meet the cost.

GDPR is designed to unify and strengthen data protection legislation across Europe, and comes into force in May next year. The move is a sound one, not least because it will provide greater protection of personal data.

Small business owners should need little reminding of the dangers of not affording sensitive data sufficient protection – the number of cyber-attacks, including identity, mandate and CEO fraud, on small business has skyrocketed in the last year. However, the new regulation requires investment.

For example, in order to comply with GDPR, which companies must, small business owners have to ensure all their employees are aware of the legislation, audit the information they have on file, communicate the new law and any changes to company policy that are required, seek consent relating to employee data, ensure a system is in place to safeguard against data breaches, designate data protection policy-related responsibilities to a specific person and more.

In short, small business owners have a lot to do. And time costs money, as does the hiring of staff to manage the increase in workload. According to research from recruiters Robert Half UK, two thirds of CIOs are planning to employ additional permanent staff to cope with the implementation of the GDPR. A further 64% are set to employ temporary or interim personnel to manage the changeover.

At a time when businesses are shouldering a range of financial burdens, including demands relating to pension auto-enrolment, cyber-security and living wage and apprenticeship regulation reform, as well as Brexit-bred market uncertainty, the application of yet more pressure on capital and cashflow is far from welcome.

This is where alternative finance can help. More and more small business owners are turning to the likes of peer-to-peer lending, crowdfunding, invoice finance and asset finance as a means of generating capital for start-up funding and to safeguard cashflow. Whether used alone or in conjunction with traditional lender services, the affordability, accessibility and flexibility of alternative finance are proving vital for SMEs.

GDPR will improve SME cyber-defences but this protection (and the requisite regulatory compliance) means investment. With margins already wafer thin, alternative finance has a key role to play in helping small business owners manage the cost.

To find out more about A&T Business Associates services, contact us on 01903 602211 or info@atbusinessassociates.co.uk.

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