PCI Compliance - Explained
What is PCI Compliance?
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Table of ContentsWhat is PCI Compliance?How Does PCI Compliance Work?PCI Compliance and Breach of Data
What is PCI Compliance?
PCI Compliance involves the technical and operational framework that a company must abide by in order to safeguard the credit card information of cardholders. PCI stands for Payment Card Industry. PCI Standards Council regulates PCI Compliance, and every firm or institution that keeps, transmits, or processes credit card based information in an electronic manner must adhere to the standard compliance policies.
Back to:BANKING, LENDING, & CREDIT INDUSTRY
How Does PCI Compliance Work?
Payment card industry, or PCI compliance standards ask merchants and financial institutions to protect credit card related data in an effective manner so as to nullify the chances of such information being stolen by hackers. In case, they are unable to do so, the hackers or suspicious parties could hack data, and make unauthorized purchases. Also, such theft would lead to stealing the identity of the cardholder, and ultimately, would result in identity fraud. A merchant complying with PCI has to abide by a given set of rules and policies framed by institutions issuing credit cards. Such policies showcase a systematic process that persons or parties processing credit cards must abide by. The first step involves asking organizations to analyze their IT infrastructure, their business processes, and several measures taken for maintaining credit card transactions. This helps in knowing prospective risks associated with credit card information. Then, companies need to identify any security gaps lying in between, and must focus on not storing personal information of credit card holders in the system. Organizations need to present compliance reports to the card issuing institutions like American Express, VISA, Master Card, the ones they tie up with. Every company dealing with credit card data needs to follow PCI compliance irrespective of the quantum of credit card dealings processed. Every organization, depending on the size of transactions for a given period of time, is divided into merchant levels. The regulator of PCI Compliance is Payment Card Industry Security Standards Council which is an institution created in the year 2006 in order to safeguard the interests of credit card holders. Big credit card issuing companies such as American Express, VISA, MasterCard, etc. regulate and monitor the Payment Card Industry Data Security Standards (PCI DSS) that are the guidelines companies must follow.
PCI Compliance and Breach of Data
The biggest data thefts or hacks in the worlds history could have been prevented in case, the affected financial companies had followed PCI compliance requirements. A few points from the Verizon 2017 Payment Security Report, analyzing the PCI DSS compliance, are:
- Retail firms had the minimum PCI compliance sustainability amongst core sectors.
- The IT sector had the maximum compliance with PCI requirements amongst all primary industries.
- 77% of organizations, after having suffered from a data breach, lacked having this top requirement of PCI Compliance: installation and maintenance of a firewall configuration.
- The report states that there is a positive relation between the companies that keep themselves updated with PCI standards and the companies ability to handle cyber threats.
- The quantum of companies religiously complying with the PCI rules is increasing significantly year by year.