The answer is Microsoft Purview Information Protection. This is the correct solution because it provides auto-labeling policies that can automatically apply a sensitivity label with encryption when credit card numbers are detected in SharePoint Online documents, directly meeting the requirement to classify and protect sensitive data at rest through content inspection. On the SC-900 exam, this scenario tests your understanding of how Information Protection differs from other Purview solutions like Data Loss Prevention (DLP) or Audit—DLP prevents sharing but does not encrypt, while Information Protection applies the label and encryption. A common trap is confusing auto-labeling with manual labeling or assuming DLP alone handles encryption; remember that encryption is a protection action tied to sensitivity labels, not DLP rules. For a quick memory tip, think “label locks data”—the sensitivity label is the key that triggers encryption automatically when sensitive content is found.
SC-900 Practice Question: Describe the capabilities of Microsoft compliance solutions
This SC-900 practice question tests your understanding of describe the capabilities of microsoft compliance solutions. This is a configuration task: choose the command set that satisfies every stated requirement. Small differences — like 'secret' vs 'password' or 'transport input ssh' vs 'all' — change whether the answer is correct. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
A company stores financial reports in SharePoint Online that contain credit card numbers. The compliance team needs to automatically apply a sensitivity label that encrypts the documents when they detect credit card data. Which Microsoft Purview solution should they configure?
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Information Protection
Microsoft Purview Information Protection (A) is the correct solution because it enables the creation of auto-labeling policies that can automatically apply a sensitivity label with encryption when credit card numbers are detected in SharePoint Online documents. This directly addresses the requirement to classify and protect sensitive data at rest based on content inspection.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
✓
Information Protection
Why this is correct
Sensitivity labels in Information Protection can auto-classify and encrypt documents based on sensitive content.
Related concept
Read the scenario before looking for a memorised answer.
✗
Data Loss Prevention
Why it's wrong here
DLP policies monitor and restrict sharing of sensitive data but do not automatically apply labels.
✗
Data Lifecycle Management
Why it's wrong here
Data Lifecycle Management governs retention and deletion, not classification or encryption.
✗
Records Management
Why it's wrong here
Records Management handles declaratory retention and disposition, not automatic labeling based on content.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates confuse the detection and blocking capabilities of Data Loss Prevention (DLP) with the automatic classification and encryption features of Information Protection, assuming DLP can also apply labels, when in fact DLP only monitors and controls data in motion or at rest without modifying the document's protection settings.
Detailed technical explanation
How to think about this question
Auto-labeling in Information Protection uses sensitive info types (e.g., Credit Card Number) defined by regular expression patterns and checksums (Luhn algorithm) to match content. When a match occurs, the policy can apply a label that triggers encryption via Azure Rights Management (Azure RMS), using AES-256 to protect the document. In a real-world scenario, a compliance team might combine this with a DLP policy to also block external sharing of the encrypted document, providing layered protection.
KKey Concepts to Remember
Read the scenario before looking for a memorised answer.
Find the constraint that changes the correct option.
Eliminate answers that are true in general but not in this case.
TExam Day Tips
→Watch for words such as best, first, most likely and least administrative effort.
→Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A cloud solutions architect for a retail company is evaluating services for a new workload. The correct answer here reflects best practice for the specific scenario described — not a general cloud recommendation. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Cloud exam questions reward reading the constraint carefully: the same technology can be right or wrong depending on the use case.
Related glossary terms
Concepts from this question explained
These glossary pages explain the core terms tested in this SC-900 question in full detail.
Describe the capabilities of Microsoft compliance solutions — This question tests Describe the capabilities of Microsoft compliance solutions — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Information Protection — Microsoft Purview Information Protection (A) is the correct solution because it enables the creation of auto-labeling policies that can automatically apply a sensitivity label with encryption when credit card numbers are detected in SharePoint Online documents. This directly addresses the requirement to classify and protect sensitive data at rest based on content inspection.
What should I do if I get this SC-900 question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
About these practice questions
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These questions test the same concept from different angles. Work through them to make sure you can recognise it however the exam phrases it.
Variation 1. A company deploys a sensitivity label as shown in the exhibit. The custom sensitive information type 'Custom_PII_Type' is configured to detect employee IDs. What happens when a user creates a new document in SharePoint Online that contains an employee ID?
hard
A.The user is prompted to manually apply the label.
B.The document is blocked from being shared externally.
✓ C.The document is automatically labeled 'Highly Confidential' and encrypted.
D.The document is deleted automatically.
Why C: The label has auto-labeling enabled, so it will automatically apply the label and encryption to the document when the condition is met. The user does not need to manually apply the label, and the document is not blocked or deleted.
Last reviewed: Jun 11, 2026
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