Data security is a critical component of maintaining a successful business, and protecting your customers’ personal data should be one of your top priorities. When you run an e-commerce business, you handle more than just the inventory and the day-to-day operations. You also handle an abundance of customer data, sensitive information that your customers have entrusted to you. The responsibility that carries is not to be underestimated.

Consider this: there are 15 million victims of identity fraud in the U.S., which is a direct result of business owners’ lack of vigilance when it comes to data security measures. The last thing that you want as a merchant is to induce more identity fraud because you were unaware of your data security options. These security options are some of the most important indicators of your business’ success, so we will explore exactly how your data security awareness contributes to that success.

FAST BREAK: Protect customer data with security solutions!

Why Data Security is Critical to Business Success

Today, electronic systems are everywhere, and they are especially popular in the payment card industry. Electronic systems handle an enormous amount of sensitive confidential data, which means there is a heightened need for data security regardless of your e-commerce business size.

When your data security isn’t up to the highest possible standard, you’re risking 3 major things:

  1. The Data Itself: There is business data and customer data, and both provide a map to the inner workings of your business.
  2. The Future and Reputation of Your Business: A reputation takes years to develop and seconds to crumble.
  3. Your Customers: If there are holes in your data security, customers will fall through them and into other businesses.

What these three factors have in common is that you cannot have business success without all of them. These factors are a constant necessary reminder of why data security contributes significantly to the success of your business, but two additional influencers are a part of all three — trust and transparency.

Data security protocols are the backbones of an eCommerce business because they create a sense of trust for a digital presence. Trust is a huge part of what attracts customers to a business, and when they do come your way, they are not just looking for a product or service they need. They are also looking to obtain that product or service in a secure environment. If your business is not meeting all of the data security requirements necessary in order for your customers to feel safe interacting with your business, then the trust will be threatened and so will your future success.

The other huge part of business success goes hand-in-hand with trust, and that’s transparency. Your customers do not only want to know that you’re protecting their information, they want to know how you are protecting it. Being transparent about your data security and which data security tools you put in place to give layered protection will have a large effect on whether or not your business continues to succeed.

All it takes to derail success is one major misstep with customer data security to cause a chain reaction of uncertainty in your current and future customers, which could cause a lot of trouble for your business. That one misstep can, fortunately, be avoided with just a few extra steps in the data security process. To get secure, you need to know two things– the most vulnerable points of the online payments process and what your e-commerce security options are to protect your payments all the way through them. We will take you through exactly what you need to know to choose the right security tools that work best for you and your customers.

Understanding the Vulnerability Points

When you are processing credit card payments online, they go through a series of stages, and the most vulnerable stages are at the beginning. Those stages are:

  • The Consumer/Cardholder
  • The Merchant
  • The Acquirer/Payment Processor
  • The Credit Card Network/Company
  • The Cardholder Issuing Bank
  • Back to the Merchant and Consumer

data securityWhen a payment is being processed, one of the most vulnerable points that cybercriminals look to target is the merchant. The first time that credit card data is sent out, it is sent from the merchant’s payment system to the acquirer/processor, making it the first and most vulnerable point for an attack. The merchant is also connected to two other highly vulnerable points — the customer and the acquirer/payment processor. It is easier for criminals to attack at a merchant point, where security measures vary business to business than it is to attack later at a banking point.

The strongest data security points of a transaction occur with the later players of the credit card payment process, such as credit card companies and the issuing banks. This is why when news of a data breach occurs, like the Chipotle data breach in early 2017, the focus is primarily on the business itself and not the resources working with it.

More than 175 million Americans collectively use over 600 million credit cards. That is 175 million identities and over 600 million credit card numbers and information that is vulnerable to hackers. As an eCommerce merchant, that should immediately bring one question to mind:

What are my data security options?

Luckily, you will get your answers right here, right now. We will explore the best security measures that you can employ in your e-commerce business to keep your data, your reputation and your customers as secure as possible.

FAST BREAK: Explore all of your security options!

Your E-Commerce Data Security Options

In many instances, facing challenges is easier said than done. When it comes to taking on the challenge of protecting your customer data and e-commerce payments, it gets easier to do when you know what your most secure options are for top-notch data security. If your understanding of data security measures along the lines of stronger passwords or avoiding public WiFi, it’s a start, but here’s a detailed look at a few more of the best data security options for your business.

Tokenization

For e-commerce payments, there’s a specialized digital token process working to bolster the security of your data. Tokenization is a data security process which takes place in what is sometimes referred to as a customer vault, depending on what payment processor you work with. Within this digital fortress, the process of tokenization exists primarily for storing and protecting payment information for recurring use, such as subscription billing or long-term payments over a specific time period.  

Tokenization begins by taking the credit card number that is submitted for payment through an SSL connection, or Secure Sockets Layer. It then exchanges the actual number with a secure digital payment token containing a code that replaces the encrypted credit card number, which is protected by a secure data storage system. The coded token is what is actually transmitted for recurring transactions, ensuring the credit card data remains under ultimate protection.

PCI Compliance

The PCI data security standard is a mandatory layer of credit card processing protection. The full name of PCI-DSS, or the Payment Card Industry Data Security Standards, is a set of 12 requirements that must be met by all merchants accepting credit cards and storing credit card data in order for them to do so safely. Although maintaining PCI compliance is an ongoing process that has to be checked annually for maximum data security effectiveness, there are a couple of steps that need to be taken in order to get off the ground.

Assemble Your Team

Designate a PCI maintenance team to keep a strict eye on your security and will also determine which merchant level your business qualifies as based on your processing volume. There are 4 merchant levels for processing payment volumes anywhere from less than $20,000 to greater than $6 million per year.

Self-Assessment Questionnaire

This will assess the current status of security at your business and determine what steps you need to take to avoid any future missteps.

Depending on your business’ processing volume per year, your PCI merchant level will vary. PCI Merchant Level 3, which is defined as processing 20,000 – 1 million transactions is a particularly good level for payment processing because it lowers credit card processing fees for you and allows you to collect accounts receivable funds faster. Once you are actively PCI compliant, it’s easy to understand why it is worth it, and why it is mandatory.  

Why PCI is Effective and Mandatory

PCI adds an extra layer of security on top of other fraud tools you may use, which will also add that level of trust that customers need in order to do business with you. However, despite being mandatory, not all businesses comply with PCI regulations, which can lead to less-than-ideal consequences for your business.

Because of the increasing threat of more sophisticated data breaches, PCI is no longer optional for merchants who want to process credit cards. While it may seem easier to forgo achieving PCI compliance, the consequences of not complying are worse than taking the steps to start.

  • Your business could be issued fines of up to $500,000 per issue, not including any potential legal fees.
  • Your business will be more prone to data security attacks without an extra protection layer.
  • You will compromise your ability to gain customer trust because a high-level data security measure isn’t verified.

Becoming PCI compliant is a no-brainer for your business, but there are still several other data security measures that you and your payment processing partner can put in place as a customer data security policy for maximum long-term protection.

Extra Security Tools

Account Updater

An account updater, which is primarily used for businesses using recurring payments, takes away the small worries. This could be wondering if you missed a payment or whether you updated your earnings information. This security feature, which works with different banking relationships, takes care of merchant-needed updates so you can focus on the actual customer and ensure that their experience with you a great one. Automated processes are a way of keeping an extra set of eyes on your business at all times, which will help you keep easier track of your customer data and make you feel more secure handling payments.

Address Verification and Real-Time Alerts

When it comes to payments data security, it’s all about the layers. Extra fraud protection tools are available for your business to give not just yourself, but also give your customers extra protection. Depending on who your payments partner is, you might have different options, but two tried-and-true security tools are an address verification system and real-time fraud alerts. Address verification will help determine the legitimacy of a credit card user online, and the fraud alerts will be able to help stop attempted fraud in its tracks.

Mobile Payment Processing

Mobile payments are one of the most secure payment methods these days, despite some hesitation to adopt it at different businesses. On top of protection like PCI and tokenization, it also can employ security measures like biometrics and NFC capabilities which are more secure than a physical card or other payment processing options.

How Payline Prioritizes Your Data Security

Data security should absolutely be one of your priorities as a merchant, but it can be a difficult field to navigate. Luckily, partners like Payline make your business’ and your customers’ security a top priority. We think it is just as important to know what measures are protecting you as it is to know that you’re being protected in general. We strive for total transparency and the best support so that you as a merchant feel secure processing payments and protecting customer data at your business. Payline works with a multi-layer data security plan using all of the above protective measures because we care that your payments are as safe as they are seamless.

On the list of decisions and factors that go into running a successful business, data security is definitely near the top. You can’t have a successful business without customers, and you won’t have customers if they don’t feel secure interacting with your business. Fortunately, there are easy ways to face data security threats with confidence and prevent them from affecting your business. With the help of a great payments partner, keeping payments secure is even easier.

Secure Your Data


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This piece was written by Lauren Minning, Content Specialist for Payline.