Mobile Ad hoc Networks (MANETs) isn't made of any pre existing infrastructure for transferring and getting information. This is an impermanent network which can be setup wherever at any instant due to its uncomplicated infrastructure. No base station is essential in this network. The nodes are linked with each other through a wireless link and a node can act as a router to promote the data to the neighboring nodes. When a node leaves a network, then novel links and fresh routes are to be established. Security has turn out to be a main worry so as to offer protected communication between mobile nodes in an unfriendly environment. In this research work, we devise an improved approach of novel encryption algorithm for achieving superior data security. A private identification based key management scheme called as an Enhanced security using Private Identification-based Key Management (EPIKM) algorithm with Encryption is designed to improve security in MANETs. The mobile agents can use novelty EPIKM encryption and digital signature to provide security and authentication services.The performance parameters like delay, energy, PDR, Normalized overhead and throughput are need to be achieve in Network Simulator-2 (NS-2) tool and to compare the obtained results with existing systems.