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Using technology in business operations - is it worth the risk?
For the majority of businesses, using the latest technology can result in significant benefits; from improved time and cost efficiencies to potential new sales avenues. But, despite the obvious gains, recent research from Close Invoice Finance found that almost 8 out of 10 SMEs still conduct less than 20% of their business transactions online.
Our research proved that the threat of online fraud is still of great concern to businesses, just as it is for consumers. This comes as little surprise when the latest figures show that the cost of online fraud has reached an estimated
£3 billion per annum. With as many as 2,000 SMEs affected by crimes such as identity fraud every year, it is not surprising that many are deterred from embracing the technology revolution.
The study also demonstrated the extent to which SMEs are avoiding using online banking, with 38% stating that they handle the entirety of their financial accounts offline. Of those who do conduct at least some of their transactions online, 35% claim that the perceived threat of online fraudsters is the main reason that they keep online business to a minimum.
Discussing the findings, David Thomson, Chief Executive of Close Invoice Finance said "This research gives real insight into just how much SMEs are concerned by online fraud and as a result are not taking up technologies that could deliver major commercial benefits".
He continued: "While it's unrealistic to expect to eradicate the threat of fraud there are some simple ways to minimise its likely impact on your business. That way you can be sure the benefits of the latest technology outweigh the risks".
In response to the research findings, our experts have compiled a list of simple security measures that SMEs can implement to safeguard confidential information when transacting online. They are:
- Keep up to speed with the latest techniques to defend against scams and fraud, as much of the internet security software advice given to individuals also applies to businesses
- Train your staff about the risks posed by fraud and how to spot the signs
- Check your website, email and Companies House records on a regular basis for signs of fraudulent activity
- Reconcile bank statements and company credit card statements meticulously
- Make it easy for staff, customers and suppliers to report anything unusual. For example, have an email link on your website
- Shred sensitive papers before you throw them out
- Set guidelines and processes for who can order things on behalf of the company. Use a formal purchase order system to prevent unwanted orders
- Vet new employees and limit staff access to sensitive information
- If dealing with a new supplier or business customer, screen them thoroughly. Insist they provide you with a landline contact number and check that you can contact them on that number
- File online with an electronic password and subscribe to PROOF, the protected online filing service that aims to reduce the possibility of fraud
- Don't rely on Companies House records when determining whether to issue goods on credit
- Always encrypt sensitive data on your computer network
- Plan ahead and have in place a clearly defined fraud response plan so that you can react quickly and effectively should fraudulent activity take place
For more information or advice, please contact Close Invoice Finance on 0800 220 257.
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If you'd like to find out more about how Close's portfolio of invoice discounting and factoring services can support your business please visit www.closeinvoice.co.uk or call 0800 220 257 to discuss your requirements. |
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