There’s no denying that online financial transactions have made paying for services or goods easier and quicker than ever before. But, they have also made the standards of payment security a lot difficult to maintain. For every individual and organization, payment security has become one of the most important things. So, let’s discuss how crucial it has become to secure online payments.
What is Payment Security?
It’s the steps that businesses take to secure their customers’ data and to avoid data breaches and unauthorized transactions. PCI Compliance and 3-D Secure (3DS) are some of its important aspects.
Types of Payment Security and their importance
It mainly has the following types:
It’s a method of securing transactions. Tokenization replaces payment information with randomly generated strings of characters. With its help, businesses don’t have to handle sensitive cardholder information each time. And, they can easily set up scheduled payments, provide customer accounts, and manage payment settings through tokenization.
- AVS (Address Verification Service)
Though AVS is quite limited when used alone, it protects against fraud when it’s combined with other security methods. It compares the known address of the cardholder with the address provided at the checkout. The credit card company sends a response code through which the tool verifies whether or not the address matches.
- Secure Socket Layer (SSL) Protocol
It’s the type of payment security that makes all the communications on a website encrypted. It’s an internet protocol and it’s extremely important for securing such web pages that process customer payment information.
You can verify if a certain site is using SSL by seeing that the site address begins with “HTTPS.” The site address won’t begin with “HTTPS” if the site isn’t using SSL. Moreover, if a site isn’t using SSL, many browsers now also alert the visitors about that.
- Card Verification Value (CVV)
It’s a three or four-digit code that is on the back of a credit card. CVV is specially designed to verify whether the purchaser has physical possession of the card or not. Thus, it prevents Card Not Present (CNP) fraud. But as with AVS, CVV also works best when combined with other methods of payment security.
- 3-D Secure (3DS)
It’s the most widely used method to secure payments. It’s used to collect information such as transaction history, IP address, and purchase amount during and before checkout. 3DS factors in and analyzes all of that data-rich information.
It collects over 100 data points regarding the cardholder, the nature of the transaction, and their device. The information is shared among three parties which include the issuer bank, the acquirer bank, and the supporting infrastructure for the protocol. These parties work together to provide a risk assessment, process the request, and authenticate or challenge the transaction.
What is PCI Compliance?
PCI DSS, Payment Card Industry Data Security Standard, is a standard that focuses on making payment security consistent worldwide. It’s a must for an organization to comply with PCI DSS requirements to process, transmit, or store cardholder data. The main purpose of these requirements is to shape the ways organizations take to secure payments.