Indian firms lost ₹17.6 crore to data breaches in the last fiscal

Indian firms lost a whopping ₹17.6 crore in 2022 on an average to data breaches, a 25% increase from 2020 which was pegged at ₹140 million, and a 6.6% increase from 2021, at ₹165 million, according to a new report.

The report titled: Cost of a Data Breach Report, by IBM and Ponemon Research Institute was based on real-world data breaches experienced by 550 organisations globally between March 2021 and March 2022, also said that India alone has seen a whopping 29,500 breaches during this period, and the average per record cost of a data breach hit an eleven-year high. India’s average per record cost of a data breach in 2022 stood at ₹6,100, a 3.3% increase from ₹5,900 in 2021, a 10.4% increase from ₹5,522 in 2020, the report added.

The global average cost of a data breach also reached an all-time high of $4.35 million for organisations, with breach costs increasing nearly 13% over the last two years, said the report.

"These incidents are contributing to rising costs of goods and services," said Viswanath Ramaswamy, Vice President, Technology, IBM Technology Sales, IBM India and South Asia. He added that 60% of global businesses have raised their prices as a result of the data breach, contributing to inflation, and inadvertently passing the cost on to customers. Hackers are exploiting these circumstances to force organisations to pay ransoms, which is further compounded by the cyber skills shortage.

The perpetuality of cyberattacks also sheds light on the “haunting effect” data breaches are having on businesses, with the IBM report finding 83% of organisations experiencing more than one data breach in their lifetime globally.  

Another factor rising over time is the after-effects of breaches on these organisations, which linger long after they occur, as nearly 50% of breach costs are incurred more than a year after the breach. For example, the study found that post breach response costs for Indian businesses increased from ₹67.20 million in 2021 to ₹71 million in 2022, an increase of 5.65%. other cost of data breaches come from lost business, detection and escalation. 

The report also revealed that in India, industrial (₹9,024), services (₹7,085) and IT (₹6,900), are the top three industries that recorded highest per record costs.

The study also revealed that the three primary initial attack vectors for data breach include stolen or compromised credentials at ₹216 million, phishing at ₹206 million and accidental data loss or lost device at ₹190 million. Increase in third party involvement, cloud migration and IoT and OT (Operational technology) environment contributed to the highest cost increase.

Other reports have also shed light on the cost of data breaches that are rising rapidly, world over, as a 2021 CyberSecurity Ventures report saw cost of data breaches increasing 10% year-over-year. The global cost of cybercrime is also spiking and could reach $10.5 trillion per year by 2025. To put the rapidly rising cost of cyberthreats in perspective, the annual cost was about $3 trillion in 2015.

Ramaswamy said that the report clears that businesses cannot evade cyberattacks. “To stay on top of growing cybersecurity challenges investment in zero-trust deployments, mature security practices, and AI-based platforms can help make all the difference when businesses are attacked,” he said.