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How SMEs can afford to fix costly cybersecurity mistakes

Despite the sustained focus on the importance of small business cybersecurity, a significant number of firms are still leaving themselves vulnerable to attack. Cost is a major barrier. How can they afford to put the proper protection in place?

Reports on the state of SME cybersecurity are becoming an increasingly regular occurrence, with few painting a positive picture of the level of protection in the sector. One of the most recent studies, from Dashlane, contained some alarming findings.

According to the research, fewer than 40% of the employees questioned had increased their cybersecurity training or adopted new security policies. In addition, only just over a third had increased their use of password managers, while almost a quarter admitted that they had only recently begun using a password manager.

Tellingly, a new survey from Direct Business shows similar findings, with only just over a quarter of small business professionals considering cyber-security a top priority. Shockingly, almost 20% of small business respondents didn’t view cyber-security as a priority at all.

Micro firms most vulnerable amid low cyber protection take up

At the same time, a new study from Global Data has revealed that almost 20% of SMEs did not have cyber insurance in 2021, while nearly 30% decided to cancel their policies. The picture is even less encouraging for micro businesses, with only 21% holding cyber insurance, compared to 40% for small businesses and over 50% for medium-sized firms.

Tellingly, one of the primary reasons behind the lack of cybersecurity cover and the decision to cancel policies is cost. Cost is also likely to be the main factor behind the shortfall in small business employee cybersecurity training and awareness.

SME cybersecurity and how alternative finance can help

It comes as little surprise to learn that cost is one the main reasons behind SME struggles with cyber-security, with the cost of living crisis further exacerbating conditions in an already challenging environment.

However, it is important that small business invest in strengthening cybersecurity because the attacks can be hugely expensive to recover from, and in some cases fatal. Critical to investment capability is access to finance and this is where alternative finance can help.

In the wake of prolonged caution from traditional lenders, which is an issue that has returned during the pandemic and amid challenging market conditions in 2022, services such as invoice finance, asset finance and peer-to-peer lending are proving a vital source of capital for small businesses, both for maintaining cashflow and for essential investment.

These facilities, which offer a more easily accessible and personalised approach to lending, are helping small businesses survive and target recovery and regrowth. Furthermore, alternative lending played a prominent role in the government’s headline emergency support scheme, the Recovery Loan Scheme. Invoice finance and asset finance between £1,000 and £10 million per business was available under the initiative. This profile has helped cement the reputation of alternative finance in the business sector.

Investing in stronger cybersecurity and SME finance options

It is very challenging for small businesses to find the resources for investment at the moment as they battle unprecedented headwinds caused by the pandemic, Brexit and the war in Ukraine, but it is vital that they have a strong level of cybersecurity. To afford this, it is vital that business owners are aware of all the finance options available to them, including the services of alternative lenders.

To find out more about A&T Business Associates services, contact Tony Hedger on 01903 602211 or tony.hedger@atbusinessassociates.co.uk.

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