Observer: Data Protection Literacy for MSMEs Must Start with the Business Owners
Jakarta (ANTARA) - Digital economy observer from CELIOS, Nailul Huda, believes that strengthening personal data protection for micro, small, and medium enterprises (MSMEs) must begin by protecting business owners from the risks of data misuse, before they are expected to be capable of protecting customer data.
Huda stated that low data protection literacy makes MSMEs not only at risk of being negligent in safeguarding consumer data but also vulnerable to becoming victims of fraud and personal data misuse.
“So far, literacy remains very low; many layers of society are unaware of the risks of personal data misuse, including the MSME sector,” Huda told ANTARA in Jakarta on Friday.
According to him, MSMEs face various risks in conducting digital activities, ranging from fraud during purchasing and payment processes to the misuse of data to obtain illegal online loans.
MSME data used in e-commerce activities is also considered vulnerable to various fraudulent modes. This situation indicates that business owners’ understanding of the importance of data protection still needs to be strengthened.
On the other hand, MSMEs also have a responsibility to protect the customer data they collect while conducting business. Consumers are increasingly paying attention to the security of personal information when asked to provide data such as telephone numbers and email addresses.
Huda noted that this condition causes the implementation of the Personal Data Protection Law (UU PDP) in the MSME sector to face multi-layered challenges.
In addition to limited understanding of basic data management concepts, many MSMEs do not yet have dedicated human resources to handle cybersecurity, recording systems are still performed manually, and the limited budget for investing in better data security systems remains a hurdle.
Therefore, according to Huda, increasing MSME capacity must go hand-in-hand with the implementation of the UU PDP so that the regulation does not become an obstacle to business digitalisation.
“The implementation of the UU PDP must be accompanied by capacity building for MSME players. The UU PDP must not turn into a barrier to MSME digitalisation,” he said.
Huda believes the government needs to provide simple data protection standards that can be applied according to the capabilities of MSMEs. Such support could include technical guidelines on minimum security standards, free mentoring and training, as well as fiscal incentives for business owners who upgrade their data protection systems.
Furthermore, large digital platforms should also be encouraged to provide built-in features for compliance with data protection principles, so that MSMEs using these platforms do not have to build entire protection systems independently.
According to Huda, this protection should also cover the data of MSME owners stored within digital platforms. In this way, the responsibility for data protection is not solely placed on MSMEs when they manage customer information.
“We must start by raising awareness and protecting MSME owners, before MSME owners can protect their customers’ data,” he said.
He added that data security is not just a matter of regulatory compliance, but is also related to trust within the digital economy. MSMEs capable of safeguarding customer data have the potential to build consumer trust and turn it into a competitive advantage.
Conversely, data misuse or leaks can damage business reputations and reduce customer trust, which is a vital asset for business sustainability amidst the decreasing face-to-face interaction in digital transactions.