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And Why PCI Compliance is Important for All Businesses – Large and Small

What is PCI Compliance?

The Payment Card Industry Data Security Standard (PCI DSS, or just PCI) is a set of requirements that have been put in place by the major card brands to keep credit card information secure. The expectation is that businesses, regardless of size, must process, store, and maintain their customers’ credit card information securely to comply with PCI guidelines.

Why Does PCI Compliance Matter?

PCI compliance requirements hold organizations responsible for maintaining the safety of their customers’ personal information. It is important that businesses adhere to these rules for the following reasons:

  • Customer Protection: Keeping your customers’ credit card information secure should be a top priority for any business. Following the PCI guidelines ensures that your business is proactive in safeguarding the personal information that is shared during each credit card transaction.
  • Customer Trust: Customers take for granted their sensitive information is secure when they are making credit card transactions at your business. They trust you. The last thing any business wants to do is betray that customer trust.
  • Data Breach Prevention: Maintaining PCI compliance requires businesses to comply with security measures such as internal audits, encryption, and fraud tracking systems. Following these regulations will make data breaches less likely.

What Happens if You are Not PCI Compliant?

There can be costly consequences for businesses that are not PCI compliant. Some of these include:

  1. Monthly Fees: Merchants that are not PCI compliant must pay a monthly non-compliance fee. These fees can add up to significant amounts over time. Depending on the size of your business, the fees can run you $125 per month.
  2. Greater Risk for a Data Breach: Compliance sets a framework for keeping customer information safe. When those guidelines are not followed, it makes a business more susceptible to data breaches when those guidelines are not followed. In 2021, data breaches cost small businesses $38,000 on average. And that is per occurrence. This includes costs for professional services to help recover from the breach, lost business opportunities, and downtime.
  3. Customer Distrust if You Incur a Breach: Risking the safety of customers’ sensitive information will inevitably hurt the reputation of your business. A natural response when customers learn their data has been breached at your business is to become hesitant to make future purchases with you.
  4. Potential for Legal Action: Individuals may take legal action against your business if their credit card data has been compromised. While many large corporations can survive these lawsuits, it could financially break small or medium-sized businesses. Along with paying legal fees, businesses are responsible to pay damages to payment card issuers that were forced to reissue credit cards and reimburse victims of fraud.

Simplifying the Compliance Process

In the discussion surrounding PCI compliance, it is clear that it is in the best interest of your business and your customers to take the necessary steps to becoming PCI compliant. The risks are too high to keep sweeping this under the rug.

Admittedly, for some businesses, PCI compliance can be a long, arduous process. Merchants have to decide which of eight PCI Self-Assessment Questionnaires (SAQ) applies to them. If your business accepts credit cards both in person and online, your SAQ can be over 300 questions!

But gambling with your customers’ trust is never a good idea. To make compliance easier for you, there are some actions you can take to reduce your scope. As a result, the need for periodic scans and the number of SAQs can be greatly reduced.

  1. Do not store your customers’ Primary Account Numbers (PAN).
    This is one of the best ways to reduce your scope. As a result, you will be eligible for a different SAQ with reduced requirements if you’re not storing cardholder information,
  2. Utilize PCI-validated Point-to-Point Encryption (P2PE) terminals at point of sale.
    By adding a terminal that removes credit card information from the purchasing process, you will therefore be protecting your business from four PCI requirements.
  3. Limit the number of departments that can view account information.
    Various departments within your business may need to access your customer database. If that is the case for you, make sure sensitive credit card data is only accessible to those who need to know that information.
  4. Use tokenization rather than credit card numbers for repeat and recurring transactions.
    Tokenization replaces credit card numbers with a proxy “token.” Even if hackers were able to access this information, it would be meaningless to them.
  5. Segment your network with firewalls.
    This limits payment card data to only a small number of systems within your business.

There are other industry and environment-specific steps you can take to make PCI certification much simpler. This is where you’ll want to bring in external support if your credit card processor doesn’t step up to guide you through the compliance process.

PCI DSS v4.0 is Released

Time to start preparing for the newest version. PCI DSS v4.0, was released in March 2022 and incorporates evolving security practices, increased flexibility to support innovation, and clear reporting methods. Businesses still have until March 2024 to become compliant, but it’s a good idea to check out the new requirements. To learn more about PCI updates and timeline, please read At a Glance: PCI DSS v4.0. Or contact me. I’ll put you in touch with our PCI compliance and security expert who will be happy to answer your questions.