AI document classification software is quickly becoming a valuable option for organizations facing strict compliance requirements and growing volumes of sensitive information.
Why? Well, you could say compliance starts with one important rule: Knowing your data.
If your business handles regulated data like financial records, health information or personally identifiable information (PII), then understanding exactly what you have and where it’s stored is essential. It’s the first step to fulfilling data subject requests, passing audits and reducing the risk of breaches.
In this blog, you’ll find out some of the key challenges with traditional data classification methods and how AI tools can help overcome them. You can then learn how AI document classification software can enhance your compliance efforts, with step-by-step instructions provided on how to use this new feature in BCWipe’s Search. As an example, we will demonstrate how to comply with the Payment Card Industry Data Security Standard (PCI DSS).
What Makes Data Classification Challenging?
Companies today are positively overflowing with data, whether we’re talking about emails, contracts, customer records or employee files. Much of that data contains sensitive or regulated information, meaning organizations face serious risks if they’re lacking a clear system to classify and manage it. These risks include:
- Non-compliance with regulations like PCI DSS, HIPAA, GDPR or CCPA
- Increased vulnerability to data breaches
- Inefficient operations, including delayed audit responses and inconsistent data handling
Despite these risks, many organizations still rely on manual methods to classify their data. These might include keyword searches, tagging files by hand or maintaining spreadsheets of sensitive assets. But manual methods can be:
- Time-consuming and difficult to scale
- Inconsistent across departments and users
- Prone to human error
The result? Many businesses simply don’t know what sensitive information they have or where it’s located. That makes data nearly impossible to protect or manage properly.
How to Address These Challenges with AI-Powered Tools
To meet the growing challenge of managing data spread across different systems and locations, businesses are increasingly turning to AI-powered tools to help them organize, protect and make sense of their files.
These tools offer several key benefits over manual methods, such as:
- Scalability: Analyze thousands of files in minutes.
- Accuracy: Avoid human mistakes and inconsistency.
- Contextual understanding: Go beyond keywords and analyze the actual meaning of content. Note that this benefit can vary depending on the tool, with some solutions offering more advanced capabilities and higher levels of precision than others.
One of the handiest aspects of AI-driven classification is that it can learn from examples. Instead of writing complex rules, with the right tool you can just upload sample files that represent a specific type of data—like customer records, invoices or medical forms—and the AI learns what to look for.
The more examples you provide, the smarter it gets. That means classification becomes faster, more accurate and fully tailored to your organization’s needs.
How Can Using AI Document Classification Software Help?
AI document classification software isn’t just for IT admins. It’s a practical, everyday tool that can help across your organization:
- Prepare for audits with a clearer picture of where sensitive data is stored
- Speed up responses to GDPR, HIPAA or CCPA data subject requests
- Support data minimization and retention policies with more confidence
- Map your data to identify and reduce unnecessary exposure of sensitive files
AI Data Classification Software Built for Compliance
When using AI tools to manage sensitive data, compliance should always come first. Not all AI is built the same, especially when it comes to how and where your data is processed.
To avoid introducing new risks, make sure to rely on AI-powered classification tools that run locally on your device or network. Sending data to external servers can raise serious privacy concerns and create compliance conflicts, especially under regulations like GDPR, PCI DSS or HIPAA.
In addition to achieving the best results, make sure your solution supports the following features:
- Meaningful, Context-Aware Classification
It’s not just about matching keywords. Look for tools that can understand the actual content and intent of your files. - Category-Level Control
You should be able to include or exclude specific types of data during search and recovery, such as financial records or employee files. - Flexibility to Train the AI
Every organization handles different types of sensitive data. A good solution should let you create and refine custom categories based on your specific needs.
One type of AI document classification software that runs locally on your network and supports the above features is Search, a PII and data discovery tool that’s available in the Enterprise Edition of BCWipe.
How to Use BCWipe’s Search to Comply with the PCI DSS Standard
Let’s take a look at how you can use the new AI document classification feature in the Enterprise Edition of BCWipe’s Search tool to achieve compliance. In this example, we identify and control the storage of cardholder data to comply with PCI DSS requirements and prevent unauthorized access. This standard outlines the steps that organizations must take to secure sensitive cardholder data, such as credit card numbers.
- Create a Custom Category
First, you need to define a category for “Cardholder Data” to capture any files containing payment card information, such as credit card numbers, expiration dates or billing addresses.
- Train the AI
Upload sample files that include this type of information. The AI will then analyze the content and learn to identify similar files.
- Run Search Across Your Network
Use the new, customized “Cardholder Data” category to scan all systems for files matching the characteristics of cardholder data.
- Review Results & Compare with PCI DSS Scope
PCI DSS requires that cardholder data be stored only in secure, authorized systems with strict access controls and encryption in place. - Wipe Data
If the AI-powered search identifies cardholder data outside the approved storage locations, you can then use BCWipe to ensure it’s securely erased from unauthorized locations.
Pro Tip: If the data must be preserved, such as for legal or audit purposes, first encrypt the files using BestCrypt and then move them to a PCI-compliant location.
Simplify Compliance with AI Document Classification Software
Data classification has always been an important part of compliance, but the challenges of classifying data effectively are increasing as the amount of data we store continues to grow. Manual methods are slow, error-prone and hard to scale.
By using the AI document classification feature in Search, you are able to work faster and smarter by teaching the AI what kind of information to look for, analyzing thousands of files in minutes, and using the tool to contextually understand data.
Quick Tips for Smarter Compliance
To get the most out of AI-powered classification and stay ahead of regulatory demands, keep these quick tips in mind:
- Know your data: Map sensitive files so you’re always audit-ready.
- Use local AI: Keep your data private by choosing tools that don’t rely on the cloud.
- Train your tool: Upload sample files to create precise, custom categories.
- Act on insights: Once you locate sensitive files, protect or securely erase them using compliant tools.
- Review regularly: Periodically revisit your categories and search results to ensure your classification stays aligned with evolving data policies and regulations.
Ready to take control of your data classification? Contact our Data Protection Specialist to learn more and test our new AI document classification feature in the Enterprise Edition of BCWipe’s Search tool.
Frequently Asked Questions (FAQs)
Is Search’s AI Document Classification Feature Secure?
Yes. The AI engine runs locally on your system, meaning your data is never sent to the cloud or external servers.
Do I Need to Be a Tech Expert to Use It?
No. The tool is user-friendly and doesn’t require any coding skills. Please see the step-by-step instructions above for an example on how to use the tool to comply with the PCI DSS standard.
Can I Create Custom Categories for My Business?
Yes. You can define and train your own data categories based on the kinds of sensitive files your organization handles.