Digital Trust

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What is Digital Trust?

Digital trust refers to the implicit confidence individuals and organizations have in the custodians of their confidential data during online transactions. It is the assurance that data will be treated according to agreed terms and conditions, safeguarding it against abuse and ensuring its security in the digital realm. As the online world expands and becomes pervasive, digital trust has emerged as the foundation for data sharing and disclosure.


Imagine you’re signing up for a software trial on the website of the software provider. As part of the signup process, you need to provide various confidential information such as credit card, social security number, and personal information. While you’re signing up, you have an implicit trust that the custodian of your data will treat the data according to the terms and conditions that govern the data sharing. In other words, you expect that your data will not be abused. That implicit trust is digital trust. Digital trust is the trust that enables organizations and individuals to perform online transactions with the confidence that the recorded footprints in the digital world are secure.

Digital trust is becoming the basis of data disclosure or sharing as the online world becomes increasingly pervasive and ubiquitous. Not too long ago, when online transactions weren’t as common as they are today, the public key would secure transactions. It would encrypt the data being shared with a public key and enable only the recipients of the data to decrypt with a private key. The online world has become much more complex with the increase in the number of components such as devices, software, users, servers, documents, digital content, identities, and digital rights. Digital trust is taken more seriously than ever, as reflected in the policies and their enforcement. Policies are being developed that define digital trust, principles, violation conditions, and punitive actions.

Principles of digital trust

To date, there is no standard document on the principles of digital trust that all businesses and organizations adhere to, but certain common principles have emerged from the circumstances that are treated as the holy grail of digital trust.

  • Reliability- Customers and stakeholders perceive a business or organization as reliable in terms of data sharing. The business or organization has demonstrated a history of reliability as a custodian of data.
  • Transparency – The business or organization transparently and explicitly shares its policies on data sharing or any updates with its customers and stakeholders.
  • Security –The business or organization demonstrates a history of protecting the data and not only has the resources to protect the data but also shares its data protection strategies and resource information with the customers and stakeholders.
  • Integrity-The business or organization has robust policies to maintain data integrity. It not only collects cohesive data but also processes the data robustly while taking enough care that it’s not compromised.

Importance of digital trust

According to McKinsey, digital trust is becoming a growth driver rather than just a legal requirement. Companies that invest more heavily in setting goals related to digital trust tend to outperform the ones that don’t. When adding best practices in cybersecurity, data protection, and the provision of trustworthy AI, the potential of growth increases significantly according to the study.

ISACA, a leading organization that promotes the importance of digital trust surveyed 50,000 people had this is what they found out.

  • Positive reputation – Respondents indicated that they were going to buy only from those businesses that have a positive reputation for protecting customer data. It was found that businesses that treated customer data as sacrosanct were 1.6 times more likely to grow than those that had lax standards of data protection.
  • Lower breaches of privacy –Respondents reported that the leaders in preserving digital trust would have much lower incidents of breaches in privacy and had robust mechanisms to address the issue. According to McKinsey, digital trust leaders would have 8% lower incidents of breaches in privacy.
  • Better decision-making- Both the customers and the businesses can make informed decisions when digital trust is paramount. The customers know the businesses they can trust with their data and they are willing to commercially engage with them feeling safe. Businesses need customer data to take their businesses forward and know that if they put in place robust policies and mechanisms for data sanctity, customers can trust them. Trust is the key to growth.
  • Customer loyalty – According to a McKinsey report, the leaders in digital trust are 14% more likely to establish strong relationships with their customers. The respondents to the survey maintain that they are extremely likely to maintain strong and long-term relationships with businesses that treat their data with utmost sanctity.

Is digital trust being maintained?

For all the discussions and narratives around the importance of digital trust, it has not been getting the importance it should. Increasingly, prospective customers have been demanding clear and cohesive data security policies from businesses but the businesses have failed largely to provide that. McKinsey surveyed many companies to find that such businesses – most of them – claim that they have the willingness and the resources to put in place a solid digital trust mechanism but the reality has been different. 57% of the executives surveyed by McKinsey report that their businesses have reported at least one incident of a severe data breach. One big incident happened in 2020 when Cognizant, a big IT services company, reported a severe data breach because of a ransomware attack. Cognizant claimed that because of the ransomware attack, a lot of unencrypted data was accessed and stolen. Imagine the severe erosion of trust Cognizant must have suffered because of this. And surely, its business must have taken a severe hit.


In the future, digital trust will play a pivotal role in driving business growth. As businesses recognize the need to establish strong mechanisms to ensure the safety of customer data, they face significant challenges. While digital trust has not yet become a universally accepted practice, certain businesses are already ahead due to their proactive policies. However, those that fail to prioritize digital trust risk losing out on opportunities. It is crucial for businesses to understand the criticality and urgency of implementing measures to build and maintain digital trust in order to thrive in the competitive landscape.


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Kaushik Pal
Technology writer
Kaushik Pal
Technology writer

Kaushik is a technical architect and software consultant with over 23 years of experience in software analysis, development, architecture, design, testing and training. He has an interest in new technologies and areas of innovation. He focuses on web architecture, web technologies, Java/J2EE, open source software, WebRTC, big data and semantic technologies. He has demonstrated expertise in requirements analysis, architectural design and implementation, technical use cases and software development. His experience has covered various industries such as insurance, banking, airlines, shipping, document management and product development, etc. He has worked on a wide range of technologies ranging from large scale (IBM…