By Sanjay Kaushik
Data today is the “new currency” for businesses and robust security measures are the need of the hour. Growing reliance on technology has significantly amplified the potential for data misuse and breaches. According to a study conducted by IBM and the Ponemon Research Institute, data breaches imposed a staggering cost of Rs 176 million on Indian firms in FY22, with 29,500 breaches occurring during this period.
All firms must enact strict data privacy rules to address concerns. In this regard, India has acknowledged the value of data privacy and the necessity for a thorough legislative framework by implementing the Digital Personal Data Protection (PDP) Bill of 2023.
A new age of data protection has thus begun, thanks to the PDP Act, founded on ideas such as permission, data localisation, and accountability. This Act reflects the changing nature of consumer-brand relationships, acknowledging that people are becoming aware of how their data is being used and are seeking more control. Therefore, it is essential to investigate the relationship between data privacy and brand trust and how organisations can navigate this challenging environment.
When an individual shares their personal information with a company, they put their trust in it to use it responsibly and securely. When brands violate this trust, it can have severe consequences. Customers lose faith and the company’s reputation takes a hit. The foundation of brand trust relies on how effectively firms safeguard their customers’ information.
Data privacy goes beyond mere compliance, giving brands a chance to nurture brand trust. First and foremost, to establish trust, brands must be transparent about their data collection, processing, and utilisation practices. Articulating these practices and securing explicit customer consent reinforces brand trust. Additionally, businesses should invest substantially in robust data security measures, safeguarding customer information and underscoring their commitment to data protection. Furthermore, granting customers control over their data is a potent trust-building measure.
Navigating India’s data protection landscape poses an immense challenge. Businesses proficient in risk management can assist firms in navigating the intricacies of data protection by providing a comprehensive array of services like data security assessments, compliance audits, and risk management solutions.
Data privacy and brand trust are inherently intertwined. As India adopts a more stringent data protection framework, businesses can establish trust by prioritising consumer data privacy. As a result, trustworthy brands can comply with the law and go the extra mile to ensure the security, transparency, and integrity of the data they handle.
The author is managing director, Netrika Consulting