The security of confidential information during financial transactions is of paramount importance. Virtual data rooms are typically used to share and store private documentation in a secure environment that allows users to access it with a restricted access. They are commonly used to carry out due diligence in M&A transactions, but can also be used for other purposes.

The top VDRs offer a range of features to ensure documents are safely stored and shared during the course of a deal or process. They could, for instance include two-factor verification, which requires that not only the password is used, but also the actual information and codes that are unique to each individual user. This helps reduce the risk of data breaches due to compromised passwords. Many VDRs also provide granular access rights that can restrict access to specific files. Another option is IP restriction, which limits access to a virtual data room to specific IP addresses. This protects sensitive information from being downloaded to non-authorized devices and stops leaks.

Other features offered on certain VDRs include watermarking, which provides an immovable identifier for each document, as well as audit logs, that record the actions taken on the files in the data room. These are used to determine who has access to or modified files, and can also aid in the investigation of data security breaches. Other useful features include secure spreadsheet viewing, which makes sure that data in Excel files can only be viewed by specified users.

Check the certifications and standards of a data room to ensure that it provides the right level of security for your documents. Ideally, it should be PCI DSS Level 1 ISO 9001 / ISO 27001 FIPS 140-2 MTCS Level 3. Some investment banks maintain an approved list of vendors that offer data rooms with whom they are comfortable working. Choose a visit this page vendor who can demonstrate these credentials, along with a good reputation in the field.