Advice
Ransomware has become one of the biggest threats facing small and medium-sized businesses. Criminals aren’t just chasing large corporations anymore. They know smaller companies often have fewer resources, which can make them easier to target. A single attack can shut down operations, drain finances, and damage customer trust.
As a community bank, 1st Source has worked every day with businesses that rely on technology. We’ve seen the risks up close, and we know the steps that can make a difference. Here’s a guide on what ransomware is, how it works, and what your business can do to stay safe.
What Ransomware Is
Ransomware is a type of malware that locks your files or systems until you pay money to criminals. Modern attackers don’t stop there. Many also threaten to publish sensitive data if payment isn’t made. This is called double extortion. Some even use “Ransomware as a Service,” where groups sell the tools to anyone who wants to run an attack.
The danger for SMBs is real. Criminals often send phishing emails, infect websites, or exploit weak passwords. Once inside, they move quickly, encrypt data, and leave you scrambling.
Why Small Businesses Are Targeted
Hackers know many smaller businesses don’t have full IT departments. They may rely on a single tech support person or even handle systems themselves. This can leave gaps in updates, security settings, or employee training.
The results are costly. A ransomware attack can bring work to a halt. Customers may lose confidence, and legal costs may rise. Recovering takes money and time, the two things that small businesses can’t afford to waste.
Common Tactics Criminals Use
Attackers look for any weak spot. Phishing emails are one of the top ways ransomware spreads. An employee clicks a link or opens an attachment, and malware enters the system. Outdated software is another easy entry point. Unpatched programs or devices often contain known flaws.
Even consumer network equipment has been flagged as a risk. In March 2025, U.S. lawmakers warned about Chinese-made routers, including TP-Link, which are widely used in homes and small businesses. They said these devices could be vulnerable to exploitation by state-linked hackers (Reuters). While TP-Link denied ties to the Chinese government, the debate shows how even affordable off-the-shelf equipment may carry hidden risks.
For SMBs that often rely on consumer-grade gear, this is an important reminder: security starts with what you plug into your network.
Building a Strong Defense
A ransomware protection strategy requires several layers. No single tool is enough on its own.
- Keep systems updated. Install software and firmware patches right away. Criminals target outdated systems first.
- Use multi-factor authentication. This adds another step for logins, such as a text code, making it harder for intruders to break in.
- Segment your network. Separate important data and systems so attackers can’t spread easily.
- Invest in endpoint security. Tools like antivirus and endpoint detection and response (EDR) software watch for suspicious activity.
- Filter email. Block known phishing attempts and scan attachments before they reach employees.
These steps work together, creating a “defense in depth” approach that reduces your risk.
Training Employees
Technology matters, but people are often the first line of defense. Train employees to spot suspicious emails, unexpected attachments, or strange login requests. Encourage them to slow down before clicking.
High-risk roles like accounting, payroll, or HR need extra training. These employees handle sensitive data and financial transfers, making them prime targets.
Regular practice builds awareness. Simple tabletop exercises can help staff rehearse what to do if ransomware strikes.
Backup and Recovery
Backups are the safety net that can save a business after an attack. Store copies of your data both in the cloud and offline. Test those backups often to make sure they work.
Immutable backups—copies that can’t be changed or erased—are especially valuable. They allow you to restore systems even if attackers try to tamper with your backups.
A tested recovery plan ensures you can get back online quickly, reducing downtime and losses.
Monitoring and Incident Response
Even with strong defenses, breaches can happen. Set up monitoring tools that alert you to unusual behavior. Create an incident response plan that outlines exactly what to do.
The plan should cover who to call, what steps to take first, and how to report the event to authorities. Law enforcement and agencies like CISA provide guidance and support. Acting quickly can limit the damage and improve your chance of recovery.
The Role of Banking Partners
Your bank should be more than a place to manage transactions. A strong banking relationship can give your business an added layer of protection when facing cyber risks. Experienced bankers can provide guidance on building financial resilience, such as keeping emergency funds, setting up safeguards for online payments, and planning for disruptions.
They can also help you think through “what if” scenarios. For example, how would your business handle a week of downtime? What cash reserves would you need to keep operations running? These conversations create a financial safety plan that supports your cybersecurity efforts.
Trusted banking partners can connect you with resources beyond money. At 1st Source Bank we stay informed about fraud trends, regulatory requirements, and industry best practices. We share insights, alert you to scams, and work alongside you to create a safer environment for your business.
External Resources
You don’t have to face ransomware alone. Agencies like the Cybersecurity and Infrastructure Security Agency (CISA) provide free guides, scanning tools, and checklists. Many state governments also offer training or funding support for SMBs. Connecting with industry associations can give you access to shared knowledge and peer experiences.
Conclusion
Ransomware is a growing threat, but it isn’t unbeatable. SMBs can build resilience by updating systems, training staff, protecting their networks, and preparing for recovery. Choosing the right equipment and financial partners adds another layer of security.
Criminals may keep changing tactics, but businesses that stay alert and proactive can reduce their risks. The key is to act now, before an attack disrupts your future.