Data protection has become a pivotal aspect of successful business operations. Immense amounts of sensitive information are being stored and processed daily. Routine tasks like tracking employee expenses, generating and fulfilling customer orders and processing website analytics generate huge amounts of potentially sensitive data. And data is most vulnerable when it needs to be used because it necessitates decryption, a process that exposes the information to potential security breaches.
Enter homomorphic encryption (HE), a promising solution to this dilemma that is revolutionizing data privacy in the business world.
What Is Homomorphic Encryption?
Homomorphic encryption is a form of data encryption that allows data analysis to be carried out on encrypted data and produces an encrypted result. This allows analysts to work with sensitive data without compromising security.
Homomorphic encryption is a form of encryption that allows computations to be carried out on encrypted data, producing an encrypted result which, when decrypted, matches the outcome of operations performed on the original, unencrypted data. This key feature provides an innovative way to work with sensitive data without compromising its security. It’s a complicated technical concept, but for business leaders, the bottom line is simple: Homomorphic encryption allows you to keep data secure while still being able to use that data for business-critical operations.
How Homomorphic Encryption Works
The use of homomorphic encryption is akin to developing a secure vault that allows you to manipulate its contents without ever opening it. The implications for businesses are far-reaching and varied: secure cloud storage, privacy-preserving audits, safe data sharing across business units or with third parties and encrypted search capabilities, to name a few.
For industries heavily reliant on data and dealing with strict data privacy regulations, such as healthcare, credit scoring or gaming, HE is a game-changer. It offers unprecedented opportunities to use third-party data services without the risk of data exposure, potentially streamlining operations and increasing access to advanced data analytics services.
There are tools that make HE easily deployable in a variety of applications without having to know cryptography. Companies interested in integrating HE in their operations have the option to adopt these tools or, for a more stable and business-savvy solution, hire developers with HE knowledge and skills.
Consider a common scenario: A company wants to leverage big data analytics or machine learning to drive strategic decision-making. To achieve this, they need to share data with an external analytics service provider. Traditional encryption methods require the company to decrypt the data before processing, risking exposure. But with HE, the company can encrypt the data, send it off for analysis and receive the encrypted results without ever exposing the original data.
It also enables secure multi-party computation (MPC), one of the key puzzle pieces in the tech stack of a contemporary interconnected business environment. This is particularly important for joint ventures, consortiums and different departments within a single corporation that need to collaborate while also maintaining the confidentiality of their individual data sets. In such instances, HE lets you collectively compute functions and share the encrypted results, without revealing any confidential information.
Homomorphic Encryption Applications and Benefits
Homomorphic encryption allows businesses to leverage external services to enhance their offers while ensuring the privacy of their customers’ data. Even during analysis, customer data remains entirely secure, demonstrating the real-world potential of HE to safeguard privacy and uphold trust.
Imagine an online retail platform wants to enhance their customers’ shopping experience through personalized product recommendations. This requires analyzing individual consumer purchasing patterns. So, the retailer decides to use a third-party machine learning service to develop a recommendation algorithm. This kind of operation involves data that, if exposed, could compromise customer trust and privacy.
To protect customer privacy, the platform’s data is encrypted using HE before being sent to the service. The encryption ensures that even though the data is leaving the company’s environment, it remains secure. No one, not even the analytics service provider, can view the customers’ personal information. The analytics service then performs computations on this encrypted data, developing a model to predict customer preferences. The encrypted results are sent back to the retail platform, where they are safely decrypted in-house, revealing the analysis outcomes.
As another example, take a financial institution that leverages data analytics to detect fraudulent transactions. The institution wants to protect its customers from potential security breaches, but the sensitive nature of financial data poses a significant challenge to data privacy and security.
To address this challenge, the financial institution employs HE to enhance its fraud detection capabilities. When a customer makes a transaction, their financial data, including account details and transaction history, is encrypted using HE before being transmitted for analysis. The data remains completely secure throughout the entire process. The encrypted data is then sent to an analytics service provider specializing in fraud detection.
The service provider can perform complex computations and identify patterns indicative of fraudulent activities without decrypting the sensitive information. The results of the analysis, in an encrypted form, are then returned to the financial institution.
Back at the financial institution, the encrypted results are decrypted, allowing the fraud detection team to access the outcomes. The institution gains valuable insights into potential fraudulent activities while maintaining the confidentiality of customer data.
Applying Data Security With Homomorphic Encryption
Homomorphic encryption is not a one-size-fits-all solution. HE can be combined with or enhanced by other privacy-enhancing technologies to create well-rounded solutions. With a range of options, businesses can choose the solution that best fits their needs and risk tolerance.
Companies that want to explore HE should consider how they receive and store data, and what they ultimately want to do with that data. Keep in mind that HE doesn’t have to replace your current infrastructure. Homomorphic encryption solutions can be integrated as an additional layer of data protection focusing on areas where data is most at risk or confidential, such as when shared externally or moved to the cloud.
Homomorphic encryption represents a significant leap in the realm of data privacy, particularly for businesses. It enables secure computations on encrypted data, opening up new opportunities for secure data sharing and analysis while keeping sensitive data safe. It’s a rapidly evolving field, and staying informed about these advances is becoming increasingly critical for businesses. As companies continue to navigate the digital landscape, understanding and harnessing the potential of homomorphic encryption will be an essential part of their data toolkit.
