User Data Protection—How Companies Keep Your Data Safe
Between November 2023 and April 2024, the U.S. experienced 2,741 publicly disclosed data breaches, compromising over 6.8 billion records[1]. The fact that the most targeted sectors were healthcare and finance, both of which handle sensitive personal information, underscores how crucial it is for companies to implement measures for protecting their users’ data.
In this guide on user data protection, we’ll explore the measures companies might take to protect user data and why it’s important they implement them. You'll also learn a method to secure your payment card details from potential hackers.
What Is User Data Protection?
User data protection refers to the procedures and systems businesses, organizations, and governments use to secure sensitive user data from unauthorized access, use, modification, or destruction. User data might include personal information such as your name, passwords, Social Security number, financial information, health information, and biometric data.
The term "user data protection" is sometimes used interchangeably with "user data privacy," but the two differ. While user data protection focuses on securing your data from unauthorized access, use, or destruction, user data privacy pertains to your right to control how your personal data is collected, used, and shared.
For instance, a company may employ strong user data protection to secure your data from unauthorized access during cyberattacks. Still, if it sells your information to third parties without your consent, it might violate your rights under data privacy laws.
Why Companies Need To Protect User Data
Businesses might collect and use your data to improve products and services, deliver targeted advertisements, personalize experiences, or comply with legal requirements. However, without proper protection, this data might be stolen or leaked and used for malicious purposes, leaving you at risk of identity theft and other kinds of fraud.
Failure to protect user data could lead to company liability and financial loss. For example, in April 2024, Ticketmaster suffered a data breach. A hacker group, ShinyHunters, compromised 560 million customers' data, including credit card numbers. A claim against the company has already been filed, seeking damages of at least $5 million for affected users[2].
Businesses might also have obligations to protect user data under data privacy laws. State laws such as the California Consumer Privacy Act (CCPA) require certain companies to use reasonable data protection measures to secure user data[3]. Federal laws with similar provisions include:
- Children’s Online Privacy Protection Act (COPPA)[4]—Regulates the collection of personal information of children under 13 years of age
- Gramm-Leach-Bliley Act (GLBA)[5]—Requires financial institutions to explain their information-sharing practices and safeguard customers' sensitive data
- Health Insurance Profitability and Accountability Act (HIPAA)[6]—Sets standards for protecting patients' medical records and personal health information
Data breaches also erode consumer trust, affecting customer loyalty and brand reputation. In fact, in a study by Vercara, 75% of surveyed Americans said they would stop doing business with a company if it experienced a cyber incident[7].
How Do Companies Protect Customer Information?
Businesses can protect customer personal information by implementing the following security measures:
- Data encryption
- Access controls
- Data backups and recovery
- Vendor security assessment
Data Encryption
Encryption converts plain text into unreadable code using complex mathematical algorithms such as AES (Advanced Encryption Standard), RSA (Rivest-Shamir-Adleman), and ChaCha20. In some cases, businesses might also use encryption key management strategies, such as splitting a cryptographic key into multiple pieces and storing them in different locations. This makes it difficult for hackers to reconstitute the key and decrypt the data.
Access Controls
Access controls restrict access to sensitive data based on an employee’s identity, role, or privileges. Businesses can implement single sign-on (SSO), role management, and record-keeping to ensure that only authorized personnel access sensitive data. For instance, a company may limit access to customer financial information to only employees in the finance department and keep a record of who accessed this data and when.
Data Backups and Recovery
Data backups and recovery processes allow companies to quickly recover user data in case of a cyberattack or system failure, reducing downtime and minimizing the risk of permanent data loss. The 3-2-1 backup rule is often recommended, which involves having three copies of data (original and two backups) stored on two different types of media (cloud and physical) and one copy offline to prevent it from being compromised.
Vendor Security Assessment
Companies often allow third parties to access their systems and data to provide services or software solutions. Vendor security assessments are crucial for keeping users' data safe, as they evaluate risks, identify vulnerabilities, and ensure compliance with security policies and regulations.
What Measures Can You Take To Protect Your Data?
Even when businesses implement various security measures to protect user data, breaches might still happen. However, there are proactive steps you can take to reduce the risk of your personal information being compromised in the event of a security breach. Three of these steps you might try include:
- Adjusting the privacy settings of service providers such as Google or Amazon to minimize the data they collect and share
- Removing personal information from data broker sites, either manually or with the help of data removal services
- Creating a strong, unique password for each account to prevent a single compromised password from jeopardizing multiple accounts
You can also use virtual cards when shopping online to protect your financial information. These cards connect to an underlying funding source, such as your payment card or bank account, and come with randomly generated card numbers. You can use virtual cards instead of your actual card number to make online purchases and keep your real card details safe from potential hackers.
Banks sometimes offer virtual cards, but if you opt for a dedicated virtual card provider like Privacy, you can benefit from advanced security and card control features.
Use Privacy Cards To Protect Your Data
As a PCI-DSS-compliant company, Privacy employs stringent security standards similar to those used by banks. It encrypts your data with the AES-256 encryption algorithm, making it nearly impossible for unauthorized individuals to access it. Privacy also undergoes regular audits by third-party security experts, ensuring it meets the highest data protection standards.
Additional security measures Privacy uses include:
- Transaction alerts—You get real-time notifications when your virtual cards are used or declined, helping you immediately spot potentially suspicious activity.
- Firewalled servers—Privacy servers are protected by robust firewalls to protect against unauthorized access.
- Two-factor authentication (2FA)—You can strengthen the security of your Privacy account by activating 2FA through email, SMS, or authenticator app.
Privacy Card Types and Features
Privacy allows you to generate three types of virtual cards:
You can set spending limits on your Privacy Cards, and Privacy will decline any transactions that exceed the set amount. This feature can help protect you from excessive charges and price hikes you weren't aware of.
Privacy also allows you to pause and close your virtual cards, blocking all further charges. This feature can help reduce the risk of accidental charges, such as those that may occur when stopping a subscription.
Additional Convenience Features
To make virtual card management seamless, Privacy offers several additional features:
- 1Password integration—Privacy seamlessly integrates with 1Password, enabling you to manage your passwords and payment information from the password manager’s browser extension.
- Privacy App—Available on Android and iOS devices, the mobile app allows you to create new cards, monitor transactions, and set spending limits, all from your smartphone.
- Privacy Browser Extension—The extension is available for popular browsers such as Edge, Chrome, Firefox, Safari, and Safari for iOS. It lets you create and autofill virtual card details directly from your browser, facilitating faster checkouts.
How To Get a Privacy Card
To join Privacy and get your first virtual card, follow four simple steps:
- Register on the Privacy website
- Verify your identity to ensure your account's security
- Link a funding source to your Privacy account
- Request your first Privacy Card
Privacy offers four plans to cater to different needs:
