Cybercrime is on the rise with no end in sight. As the business world expands ever further into the digital realm, ongoing risks are constantly evolving right alongside. Data breaches and ransomware are now a daily issue for many organizations no matter their size. The numbers and figures surrounding cybercrime should be eye-opening for any business owner as they illuminate the enormous sums being stolen by criminals and pose a lingering threat to every company’s bottom line.
Just how much money are cybercriminals raking in? And how much can you expect your business to pay as attacks and their associated costs increase? Let’s dive into the numbers in order to provide insight into those questions and more.
Global Outlook
Cybercrime is expected to cost nearly $6 trillion across the globe in 2021 (Morgan, 2020). This takes into account instances of personal identity theft and is not exclusive to businesses, but the figure still demonstrates the huge amounts to be made by threat actors in a number of ways. Even more alarming, this cost is predicted to balloon over the next few years to reach $10.5 trillion by 2025 (Morgan, 2020).
Those numbers should have your attention as they are large enough to surpass just about any other type of criminal threat to your business. And the reach of these existing and expected threats are increasingly difficult, if not outright impossible, to avoid. If you have yet to see these threats to your business firsthand, chances are you will soon.
Ransomware Poses Largest Losses
Ransomware is one of the top threats to businesses, and it also poses the largest potential cost. The average ransomware payment increased steadily throughout 2020 to nearly $244,000 while the FBI reports that around 4,000 ransomware attacks have occurred daily since 2016 (FBI, 2020). The average downtime caused by one of these attacks is also on the rise at 19 days. This represents additional costs to the victim business as it loses potential revenues resulting from the attack as well.
A recent cyber security survey of hundreds of US organizations showed that 68% have had an issue with ransomware and paid a ransom with another 10% affected but choosing not to pay. This puts the number of businesses that experienced ransomware in 2020 at 78%, and those numbers are likely to grow. Simply put, your business is very likely to deal with ransomware, if it hasn’t already.
Big Data Breaches on the Rise
There have been a number of highly publicized data breaches affecting larger companies recently. While these breaches have a cost that goes beyond the direct financial implications to adverse impact customer trust and company reputation as well, the numbers are still staggering. One report shows that the average cost of a data breach is $3.86 million and takes 280 days to fully contain. And on the extreme end of the spectrum, the 2017 Equifax breach has cost the company anywhere from $2 to $4 billion, depending on the source reporting and taking into account ongoing settlement payments to affected customers.
The threat actors behind the data breaches involving larger companies are typically after customer personal information that can be used for financial gain in follow-on crimes. As these customers learn more about how the big breaches impact their wellbeing, they expect the organizations they entrust with their personal information to take this into account as well. Another cost that companies can expect from a large breach is the loss of customer trust and loyalty. While there may not be an exact figure associated with this, it has obvious financial ramifications, nonetheless.
Small Businesses Pay the Price
Small to mid-sized business are particularly at risk as they often cannot deal with the great cost involved with remediating a data breach or ransomware attack. There are currently over 30 million small businesses in the US, and not all of those businesses are prepared to handle the cost of potential cyber threats. Nearly 60% of small business go out of business within six months after an attack as the effects can linger and result in the unfortunate end involving their closing up shop (Johnson, 2019). These businesses simply don’t have the financial resources to recover from such an event which is another reason that having data breach defenses in place is crucial.
Is Your Industry at Increased Risk?
The healthcare industry seems to be the current focus of cybercrime and it has the highest risk of ransomware and other attacks compared to other industries. The disruption caused by the pandemic may have something to do with this situation, and hospitals are the biggest target. Over 93% of healthcare organizations have had some sort of data breach in the last 3 years.
Financial and banking institutions pay the highest cost from cybercrime with averages approaching $6 million per incident. The education sector has seen an almost 400% increase in ransomware attacks over the course of 2020. These numbers reflect the current state of industry-specific attacks, but they are always changing and evolving. No industry is immune from these risks or their associated costs.
Final Thoughts
There is no way for your business to entirely avoid the risks of cybercrime. And while the potential for a data breach or ransomware attack can have you on constant alert, your establishing a plan for quick response action is essential to limit potential costs – as is having adequate defenses in place. No matter the size of your business or what industry your organization is in, it always pays to be ahead of the curve.
LibertyID is the leader in identity theft restoration, having restored the identities of tens of thousands of individuals without fail. If you retain personal information on your customers, now is the time to get data breach planning and a response program in place with our LibertyID for Small Business data breach preparation program. With LibertyID Enterprise you can now add value to existing products, services, or relationships by covering your customers, employees, or members with LibertyID’s fully managed identity theft restoration service – at a fraction of our retail price – with no enrollment and no file sharing. We have no direct communication with your group members – until they need us.
Call us now for a no obligation proposal at 844-44-LIBERTY (844) 445-4237
References:
- Morgan, S (2020, Nov 13) Cybercrime To Cost The World $10.5 Trillion Annually By 2025. Cybercrime Magazine.
- FBI Report (2020). How to Protect Your Networks from Ransomware.
- Johnson, R (2019, Jan 2) 60 Percent Of Small Companies Close Within 6 Months of Being Hacked. Cybercrime Magazine.