SMEs which fail to get to grips with data protection issues could be at risk of losing customers, one expert has warned.

David Smith, deputy commissioner at the Information Commissioner's Office (ICO), explained that the public is increasingly concerned about the manner in which companies look after their personal information.

He added that storing data securely is crucial if a firm is to be perceived as trustworthy, raising the prospect that companies may wish to implement a disaster recovery system.

Mr Smith said: "If we all regularly start to ask the right questions then organisations will respond to public demand and take the protection of our personal information more seriously.

"If organisations fail to recognise the importance of data protection they not only risk losing business. They could also face action from the ICO."

Yesterday, the government warned that firms in the UK are over reliant on the internet and need to have a plan in place to deal with the possibility of a prolonged outage.

A recent survey for Connect found that one in ten companies has lost important data as a result of a backup failure. The company has now developed a unique online backup service - http://www.totalrecall.co.uk – for SMEs to ensure they can survive any disaster.