Why Is PCI Compliance Necessary?

The payment card industry understands the need for security like perhaps no other industry. Cardholder data is the most sensitive information about an individual, essentially a digital identity. Without proper security protections, leaked cardholder data can all too easily grant unauthorized access and lead to identity theft and credit card fraud.

With all the players in the payment card industry, maintaining security standards is the greatest challenge faced by all. Over the years, the payment card industry has experienced repeated major evolutions, from antiquated manual imprinters with paper receipts – no phone line necessary – to an eCommerce-driven economy with online transactions.

Why the Internet Challenges the Payment Card Industry

Leveraging state-of-the-art technology, the payment card industry relies on digital communication in a delicately balanced technology ecosystem. This ecosystem requires sophisticated security measures to provide cybersecurity for cardholder data. The dependency on the Internet and the variety of players involved in each transaction are exactly why cybersecurity measures are so crucial.

From the days of dial-up transmitting data over legacy telephone lines – “landlines” – to more advanced processes today involving dedicated networks with regulated protocols to protect digital data, payment card transactions pose unique risks that require unique solutions.

What Does PCI Compliance Involve?

Technology is at the core of modern payment card transactions, from vendors and merchants to payment processing networks and credit card companies. The more parties that are involved, the greater the need for heightened security to offset the risks of unauthorized access at just one of the endpoints.

In 2006, the major credit card companies agreed to an oversight body that would drive innovation and technology with regards to security standards, forming the Payment Card Industry Security Standards Council with the focus of protecting cardholder financial account information, establishing uniform security guidelines that minimize the risk of exposure of cardholder data.

The Council operates based on a set of security guidelines, the Payment Card Industry Data Security Standards (PCI DSS) detailing how cardholder data should be safeguarded throughout payment card transactions. The PCI DSS requirements direct how this data needs to be protected, including how the data is stored, accessed, and processed. These requirements focus on the technology in the payment card industry player ecosystem, addressing cardholder financial account information security in key areas:

  • IT systems and networks
  • Encrypt cardholder Information
  • Check often for security updates, and install promptly
  • Limit access to sensitive information
  • Track and log all network activity to prevent unauthorized access
  • Establish a formal information security policy for all users, and enforce protocols

Why Should You Want to Become PCI Compliant?

The areas outlined here focus on a common theme: advanced technology needs advanced security. Advanced security for your technology has the added benefit of protecting other areas of your business to prevent unauthorized access and data breaches.

Businesses that process payment card transactions and fail to become PCI compliant also face large penalties and fines for negligence. The risk of potentially exposing cardholder data to identity theft and credit card fraud is just too great a cost.

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