The security of confidential information in financial transactions is of paramount importance. Virtual data rooms allow users to keep and share private documents in a controlled setting. Typically, they are utilized for due diligence in M&A deals, but they can be used for other reasons as well.
The best VDRs offer a range of features to ensure documents are safe and shared during a transaction or process. They could, for instance include two-factor verification which requires not only the password is used, but also real information and codes that are unique to each individual user. This decreases the chance of data breaches caused by compromised passwords. Many VDRs offer granular permissions that restrict access to particular files. Another option is IP restriction, which limits access to a virtual data room to a specific IP addresses. This prevents sensitive data from being downloaded onto non-authorized devices, and helps avoid leaks.
Some VDRs also have watermarking, which is a permanent identifiable identifier that is placed on every document. They also have audit logs that track all the actions taken on the files in the data room. These logs are useful in determining who has accessed and modified which files and assist in the investigation of data breaches. Secure spreadsheet viewing is a useful feature. It assures that Excel documents can only be viewed by specific users.
When choosing a data room, be sure to check its certifications and standards to verify that it offers the right level of security for your documents. It should be PCI DSS Level 1, ISO 9001 / ISO 27001, FIPS 140-2 and MTCS Level 3. Some dataroomanalytics.net/running-a-successful-startup-crowdfunding-campaign-a-guide/ investment banks maintain a list of approved vendors that include data rooms with which they are happy working. You should seek out a data room provider who can demonstrate these credentials and has a great reputation in the field.