Small Businesses Face Major Cyber Threats

In the past year, 81% of surveyed small businesses reported experiencing a security or data breach. Cyberattacks pose a significant concern, with 27% ranking them among their top worries and 31% feeling least prepared to handle them. Small businesses are not too small to be targets; in fact, their size often makes them attractive to cybercriminals seeking an entry point.

For businesses that suffer breaches, the financial impact is severe. The Identity Theft Resource Center reported that 63% of affected small businesses incurred losses of $250,000 or more. This has led many to increase prices to offset these costs. High-risk industries include financial services, e-commerce, professional services, and those handling sensitive customer data or processing digital payments.

Common cyber threats include phishing, stolen credentials, account takeovers, ransomware, and payment fraud. For instance, business email compromise (BEC) alone caused approximately $3 billion in reported losses in 2025. Cyber liability insurance can help mitigate these risks, covering costs for data restoration, legal defense, and lost income.

Small businesses can enhance their defenses by using secure payment systems, implementing multi-factor authentication, verifying all transactions and links, and conducting regular employee training on spotting scams. Cybersecurity should be treated as an ongoing business function, with regular reviews of system access, data storage, and potential business disruptions.