Study Finds Small Business Owners Lack Fraud Protection
Even as tech security remains a top concern for small business owners, some entrepreneurs are neglecting to include security measures in budgeting and planning for company operations. According to a survey conducted by Bank of the West, this problem is widespread. The “Fighting Fraud: Small Business Owner Attitudes about Fraud Prevention and Security” survey found that while 95 percent of entrepreneurs had some precautions in place to prevent fraud, only 18 percent used two-person controls, which have been found to be some of the most important precautions.
The survey found small business owners in general lacked “foundational security measures,” 49 percent of respondents said they fail to conduct routine financial and inventory checks. The study further found only 30 percent of entrepreneurs use fraud prevention services, and only 36 percent of small business owners said they have data security policies in place.
Michelle DiGangi, executive vice president of small and medium enterprise banking at Bank of the West, said security at small enterprises is of significant importance.
“Small businesses are particularly susceptible to fraud because they have fewer resources,” DiGangi said. “Yet, the impact of the resulting losses is usually much greater than for larger businesses.”
One of the reasons why some business owners neglect to incorporate security measures in their business plans is due to cost. Conducting employee background checks, buying new technology and investing in security measures can be costly, making it difficult for struggling small business owners to focus on optimal resource use.
If a small business owner is having trouble affording safety and security precautions, they can come to National Funding for assistance. The professionals at National Funding can help with equipment financing for technology, as well as with getting a small business loan to help keep a business safe.