5 Data Privacy Challenges and How to Fix Them

5 Data Privacy Challenges and How to Fix Them

The last few years have seen increased awareness about safeguarding data privacy. This has resulted in governments taking steps to ensure data protection through laws like the GDPR and CCPA. Despite this, some platforms and applications may still collect and utilize user data beyond the lawful scope.

With growing Internet usage, the importance of data privacy has risen due to the increasing use and abuse of personal data. Recent privacy concerns have pushed many regulatory authorities to make it mandatory to control customer data collection. Consent is needed for any brand to collect customer data.

According to Gartner,

by year-end of 2024, 75% of the world's population will have its data covered under modern privacy laws. It further predicts that large organizations' average annual budget for privacy will exceed USD 2.5 million by 2024.

Due to these developments, many businesses place data privacy at the top of their risk management agendas.

Why Is Data Privacy Important?

Data privacy is vital because users must trust that their data will be handled carefully when engaging with brands. Meanwhile, companies must use data protection practices to demonstrate to their customers that they can be trusted with sensitive data. Thus, data privacy measures are critical because:

  • Help build trust and a good reputation
  • Avoiding compliance problems with the law
  • Guarding against digital theft

Also read: How Companies Can Boost their Data Privacy Practices

Data Privacy Challenges and How to Fix them

Businesses today face many challenges when it comes to protecting personal data privacy. If they handle these challenges effectively, they can gain a competitive edge, but there can be negative consequences if they don’t.

Data exposures result in operational downtime and penalties for not following the rules. That’s why ensuring data privacy is a legal requirement and an essential business practice. Hence, successful companies make personal data privacy a core business value, which helps them stand out and retain clients.

Some of the data privacy challenges and their fixes are mentioned below:

  1. Inability to Garner Consumer Trust

Businesses today must ensure that their customer’s data is secure. There have been serious data thefts over the past few years, and customers cannot easily trust brands.

They must be clearly aware of how their personal data is being handled and stored. They should not be left to wonder about the safety of their data and how it will be used.

According to KPMG, 68% of customers are concerned about the level of data being collected by businesses. Lack of transparency is a leading cause of this mistrust.

Companies must clearly communicate about their data storage and security policies to build trust. They should also update and patch their security and data handling tools. They should ensure their customers know that data privacy protection is their key business strength.

Companies should clearly notify how they process data and protect their customers’ information. Then, they can gain credibility in the market, assuring new and existing customers that their data is managed with the strongest security measures.

Regulations require companies to obtain consent before collecting customer data. Consent agreements are essential as they allow individuals to allow the companies to take and use their data. To create trust, these companies need to keep transparency about how it will be used.

  1. Excessive Laws and Regulations

Businesses face the growing challenge of complying with increasingly complex and dynamic data protection laws and regulations.

Several factors influence these laws and regulations. These can be about a business’s location and the location of the consumers it serves.

For instance, GDPR protects customers’ data in Europe, and companies that want to do business in the EU need to comply.

Different laws protect specific types of data in the U.S., but a comprehensive federal law protects consumer data – the CCPA.

Regulatory authorities keep a strict tab on data usage. Businesses must ensure they use customer data only as they are allowed to.

Hence, companies must allocate sufficient resources to ensure all stakeholders are updated with the evolving regulatory environment.

  1. Lack of Data Visibility

Organizations need to know where their data is, what type of data they have, and how sensitive it is. If they do, they can keep the correct information private. Using tools to find and classify data is crucial.

It helps protect sensitive data from privacy issues and ensures it is appropriately treated. Even if a business adheres to all compliances and has robust database tools, it must still ensure that users know what data is collected, how it is stored and used.

Also, most laws allow consumers to control some of the data that a business has collected about them. Therefore, businesses must make it easy for consumers to exercise their privacy rights.

To avoid these issues, businesses should record personal data and why they hold it. This practice is called data mapping. Data mapping is essential for complying with most data governance programs. It is a critical requirement under specific data protection laws, like the General Data Protection Regulation (GDPR).

  1. Proliferation of Connected Devices

It can be a challenge to keep data secure with an increasing number of connected devices today. There are end point devices using Internet of Things (IoT), and increasingly online networked devices in use. The smartphone alone is the single biggest threat to data privacy! As more devices are added to the workplace, managing data becomes more complex.

If businesses do not have proper controls, they risk unauthorized access to their customers’ and employees’ data. In case of an incident, they can face humungous penalties, fines, and even the company’s closure if the breach is serious and big enough. On the other hand, in case they are unable to keep data secure, they will lose credibility in the market.

Companies must manage compliance and data privacy across different sources, operating systems, and multiple apps. To do this, appropriate data governance procedures must be in place.

  1. Inability to Handle Growing Data Sources

As computing power increases and cloud storage becomes cheaper, businesses can rely more on data. This may seem trivial, but managing large quantities of personal information can lead to serious privacy concerns. Data privacy laws generally require entities to have a purpose and lawful requirement for collecting and using personal data. Accumulating data without purpose may attract severe penalties for non-compliance with these laws.

To keep their business data safe, companies need to:

  1. First, only collect the data required—don’t keep more than necessary.
  2. Secondly, a well-trained data handling team should be established so that each member is aware of the compliances, limitations, and outcomes of using that data.

Experts recommend company-wide training on cybersecurity and data privacy risks. By doing this, teams can be better prepared for any challenges that come their way.

Also read: Data Privacy Strategies and Imperatives for Businesses


It’s not easy to eliminate all risks associated with your data. However, it is important to note that data privacy principles operate like a trust game. They ensure that everyone plays fair and respects the other.

As companies become increasingly digital, data collation has become necessary for almost all business operations. This has also increased the risk of data theft or wrong usage.

Today’s ever-changing digital landscape demands more attention to safeguard customers’ personal information, or face financial and reputational consequences.

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