Does Your SaaS Need a Privacy Policy?

If you've built a SaaS product and you're still putting off the privacy policy, you're not alone. Most founders treat it as something to sort out later — after the launch, after the first paying customer, after the MVP is stable.

The problem is that "later" can cost you.

A missing or inadequate privacy policy isn't just bad practice. In the UK and EU, it's a legal requirement the moment you collect personal data from users. And almost every SaaS product collects personal data — even if it's just an email address at sign-up.

Here's what you actually need to know.

What Counts as Personal Data?

More than most founders realise. Personal data includes:

• Email addresses
• Names
• IP addresses
• Usage data (which features a user clicks on, how long they're in the app)
• Payment information
• Location data
• Device identifiers

If your product collects any of these — and your product almost certainly does — you are legally required to tell your users about it.

Why the Law Requires It

In the UK, the UK GDPR (and its predecessor, the EU GDPR) requires any business collecting personal data to publish a clear, accessible privacy policy. This applies to:

• SaaS products with UK or EU users
• Mobile apps available in the UK or EU App Stores
• Any website with a contact form, sign-up form, or analytics

The Information Commissioner's Office (ICO) in the UK can issue fines of up to £17.5 million or 4% of global annual turnover for serious breaches. While enforcement against small startups is rare, a missing privacy policy is an immediate red flag to enterprise customers, investors, and anyone doing due diligence on your product.

Beyond fines — users notice. A product without a privacy policy looks unfinished. It undermines trust at the exact moment you're asking someone to hand over their personal information.

What Your SaaS Privacy Policy Needs to Cover

A proper privacy policy for a SaaS product should include:

1. Who you are Your company name, trading name, and contact details. If you're a sole trader, this can be your name and email.

2. What data you collect Be specific. "We collect your email address when you sign up" is better than "we may collect certain information."

3. Why you collect it The legal basis for each type of data. Under UK GDPR, you need a valid reason — contract performance, legitimate interests, or consent.

4. Who you share it with If you use Stripe for payments, Mixpanel for analytics, Intercom for support — these third parties need to be named.

5. How long you keep it You can't keep data indefinitely. Set out your retention periods clearly.

6. User rights UK users have the right to access, correct, delete, and export their data. Your policy needs to acknowledge this and tell users how to exercise these rights.

7. Cookies If your SaaS uses cookies — and it almost certainly does — your privacy policy should reference your cookie policy or cover cookies directly.

The Problem With Generic Templates

There are free privacy policy generators online that produce generic, placeholder-filled documents. The problem is they're not personalised to your product.

A privacy policy that says "we may collect [INSERT DATA TYPES]" or "we use [INSERT THIRD PARTIES]" is worse than useless. It signals to users and regulators that you copied a template without reading it. It also may not accurately reflect what your product actually does.

Your privacy policy needs to be specific to your product, your data practices, and your jurisdiction.

How to Get One Without Hiring a Lawyer

You don't need to spend £500 on a solicitor to get a proper privacy policy.

Need this document for your business? InkTerms generates it in minutes — tailored to your answers, in plain English.