The data security landscape in Singapore has not been at its best in recent years: cyber threats increased by 33.5% in 2024 compared to 2023. At the same time, 99% of organizations that experienced a data breach incident also suffered a business impact, such as data loss, business disruption, or reputation damage.
The need for secure file sharing for business is obvious, as companies look for ways to comply with the Personal Data Protection Act Singapore (PDPA) and safeguard sensitive information such as financial statements, legal files, or intellectual property.
Unfortunately, using traditional file-sharing platforms is typically not enough for handling such sensitive data. And this is when virtual data rooms (VDRs) come in handy.
In this article, we describe the benefits of secure file-sharing platforms like VDRs and explain how they differ from traditional file-sharing solutions.
What secure file sharing means in 2025
In 2025, when the pace of global digitalization is peaking, secure file sharing for business is no longer just about uploading and sending files online.
Now, companies need to take care about protecting sensitive information at every step of its lifecycle — from storage and transfer to access and compliance.
Secure file sharing in 2025 means more than security. It’s about visibility, control, and seamless integration into business operations.
Here’s what it includes:
- End-to-end file encryption
Modern platforms use strong data encryption both in transit and at rest. That means files are protected while moving between users and while stored. Every time you send files online, the system automatically encrypts files, reducing the risk of breaches or leaks. - Access control and visibility
Secure file sharing solutions give businesses full control over who can access what. This includes user permissions, two-factor authentication, access logs, and the ability to revoke access at any time. Admins can see when and by whom an encrypted file was viewed or downloaded. - Business-ready features
Modern platforms are designed for complex workflows. They support fast, secure transfer of large documents, allow teams to sign documents online, and ensure compliance with regulations like GDPR, HIPAA, or PDPA. Features like version control and secure storage are built in.
Common file-sharing platforms: Easy but risky
Traditional online file-sharing platforms like Dropbox, Google Drive, and OneDrive are popular choices, especially for personal use and small teams. They make it easy to share big files quickly, collaborate in real time, and store documents in the cloud. However, when it comes to enterprise use, these tools often fall short of meeting strict company data protection policies.
The main issue is that these file-sharing platforms are not built for advanced security or compliance. For example:
- Shared links are difficult to revoke, which means sensitive documents can remain accessible longer than intended when sharing links with third parties.
- There are no document-level permissions, only different access levels to a shared folder, making it hard to control who can view, edit, or download each file.
- These tools lack a detailed built-in audit trail, so there’s no clear record of who accessed what and when.
- Public link sharing creates serious data protection risks, especially in regions with strict regulations like the data protection policy in Singapore (PDPA).
For businesses that deal with confidential information, using such file-sharing platforms puts them at risk of violating internal policies or legal standards. While convenient, these tools simply don’t offer the control, visibility, or compliance needed for secure enterprise use.
That’s why companies seeking serious data protection are turning to purpose-built solutions designed for regulated industries, such as virtual data rooms.
Virtual data rooms: A secure file-sharing platform for businesses
Unlike common file-sharing services, virtual data rooms offer an enhanced security level. It makes them suitable for sharing sensitive data like financials, contracts, or legal documents during mergers and acquisitions (M&A), legal proceedings, or investor communication.
Here’s how VDRs ensure data protection in the financial services industry and other sectors where lots of sensitive files are shared:
- Secure access control
With role-based access control, you decide exactly who can view, edit, or download each document. Permissions can be set by user, group, or even down to the page level, ensuring sensitive data stays available only for intended recipients. Additionally, there’s an ability to set expiration dates for each user’s access. - Encrypted file sharing and storage
All files are stored using encrypted file sharing protocols and protected during secure file transfer. This keeps your data safe both in motion and at rest. - Enhanced document protection
Features like dynamic watermarking add an extra layer of accountability, while two-factor authentication ensures only verified users gain access. These tools work together to reduce leaks and sharing with bad actors. - Full audit trails
Every action — viewing, downloading, or printing — is logged in a detailed audit trail. This level of transparency is vital for compliance and the due diligence process.
iDeals offers advanced secure file sharing with end-to-end encryption, detailed access permissions, dynamic watermarking, and full audit logs — ideal for high-stakes business use.
SecureDocs is built for quick and simple secure file sharing with permission-based access, automatic audit trails, and encryption at rest and in transit — perfect for growing teams and SMBs.
Box combines cloud storage with secure file sharing, offering enterprise-grade encryption, access control, and integration with productivity tools — great for collaboration-focused teams.
Additional read: What is the price of VDR services? Learn in our dedicated article about the virtual data room cost.
Feature comparison table: VDR vs file-sharing tools
Let’s take a look at the key differences between VDRs and traditional file-sharing tools.
Disclaimer: The description of file-sharing tools’ offerings is based on the publicly available information about the top solutions on the market.
| Feature | Virtual data room | File-sharing tools |
|---|---|---|
| Secure file transfer | Offers fast and secure transfers with end-to-end encryption for all documents | Basic secure file transfer, but lacks full protection |
| Encrypted file sharing | Automatically creates and stores each file as an encrypted file, compliant with policies | Limited encryption; some tools don’t encrypt stored files |
| Large file transfer | Built to handle large file transfers without performance issues | May struggle with speed and stability when sharing big files |
| Role-based access control | Fine-grained secure access control by user, team, or document | Basic folder-level access; no per-document restrictions |
| Two-factor authentication | Enforced for all users to prevent unauthorized access | Often optional, not consistently applied |
| Dynamic watermarking | Watermarks are applied to documents in real time to track and deter leaks | Not available |
| Audit trail | Full logs of who viewed, downloaded, or printed each encrypted file | Minimal or no audit capabilities |
| Public link sharing | Disabled to support the strict company data protection policy | Enabled by default; risky for data protection policies like PDPA |
| Compliance readiness | Designed to meet data protection policy standards in finance, legal, and healthcare | Not suitable for regulated industries |
| Use case fit | Ideal for high-risk, high-value business processes, such as M&A or legal | Best for everyday online file or image sharing and team collaboration |
Real-world use cases where VDRs excel
Now, let’s take a closer look at where virtual data rooms are primarily used for secure file sharing purposes:
- M&A
Deal sides use VDRs to share files like financial statements, contract drafts, and due diligence documents with multiple stakeholders while maintaining secure access control. - Legal case collaboration
Legal teams securely share confidential case files with external counsel using encrypted file sharing and built-in tools to sign documents, supporting compliance with data protection services. - Board and corporate governance
Board members use VDRs to distribute board packs, resolutions, and strategic reports with audit trails and digital signatures. It’s ideal for companies following strict company data protection policy guidelines. - Investor reporting and capital raising
Companies share sensitive performance data and financial disclosures with investors using secure file sharing for business that includes version control and role-based permissions. - Real estate and asset sales
VDRs manage large files transfer needs for property documents, site evaluations, and contracts with fast and secure transfers that ensure data remains protected throughout. - Project document management
Teams handling high-volume document workflows can track versions, assign access, and use tools to sign documents — all while aligning with enterprise-level data protection policies.
Additional read: Learn more about the M&A virtual data room and a data room for due diligence in our dedicated articles.
Why secure file sharing must comply with data protection laws
The Personal Data Protection Act Singapore sets strict rules on how organizations collect, use, and share personal data. Businesses must follow a clear data protection policy to ensure sensitive information, especially clients’ data, is handled responsibly and securely.
Virtual data rooms (VDRs) are designed to support compliance with laws like the PDPA. They offer advanced data protection solutions that go beyond basic file-sharing tools. For example:
- Customizable data retention policies help control how long files are stored and when they’re deleted.
- Controlled user access ensures only authorized users can view or download documents, reducing risk.
- Full audit logging tracks every action taken in the system for accountability and transparency.
In contrast, many standard file-sharing platforms lack proper data protection software. They don’t provide tools for managing access, tracking activity, or enforcing retention rules, putting your customer data protection policy at risk.
To stay compliant and protect files, companies need secure, compliant tools built for regulated infrastructure — virtual data rooms.
Final thoughts: invest in the right secure file-sharing platform
Not all secure file-sharing platforms are built the same. While basic tools may offer easy collaboration, they often lack the security, compliance, and control businesses need. For companies working with different business partners or handling sensitive data, especially under data protection Singapore regulations, it’s essential to reassess current tools.
Virtual data rooms provide secure file sharing with full encryption, audit trails, and access controls — features that typical apps can’t deliver. They’re scalable, compliant, and purpose-built for risk-heavy environments.
Explore the selection of the best virtual data room providers on our main page, compare their pros and cons, and select the one that fits your business needs.