Guiding merchants through payment security
Every merchant wants to make money, but often there are factors that can stand in the way if they aren’t addressed properly up front. In the case of electronic payment acceptance, security can be one of those factors.
“Payment security is all about the protection of data,” said Conal Cunningham, General Manager at Inovio, a gateway service provider. “This can be a big burden for certain merchants, and we’re here to ease the burden and make it almost disappear.”
Absolute customer protection
According to Cunningham, every company has to worry about protecting customers against breaches where card numbers and identities can be stolen, but some verticals must provide a greater degree of security to ward against a breach of any type of personally identifiable information. For example, in industries such as online dating, the merchant has an obligation to protect their customers with “absolute discretion.” These companies need everything about their customer locked down, including data such as email addresses, street addresses, names, and so on.
How is this level of comprehensive security achieved? Companies like Inovio, which have proven expertise in supporting merchants with higher security needs, start the process with a rigid formula around PCI compliance. “The objective is to make it so these merchants don’t have to touch a credit card,” explained Cunningham. “In other words, tokenization happens even before a purchase gets made.”
Of course, this also can inhibit a merchant from providing the magical, branded experience they want each customer to receive. However, at Inovio, the merchant is set up to control every aspect of the payment experience without losing the tone and presence of their brand story, all while never touching a credit card. According to Cunningham, “This reduces the PCI burden to the absolute minimum.”
The next step is to manage all personally identifiable information in a similar way as credit card data. Everything is handled on a need-to-know basis with the payment support team in order to limit risk exposure. “We’ve always operated in these spaces, so we are uniquely in tune with the concerns of discretion around identity,” continued Cunningham. “There’s a lot of secret sauce in there, but really the message to the merchant is that we take care of the problem, and we actually know what the challenges are at the front end.” In a nutshell, customer information for these merchants gets handled as an “entire identity,” so that any possibility of an incident is reduced to the absolute minimum.
All in the data
Cunningham’s advice for Independent Sales Organizations (ISOs) and Sales Partners is to become familiar with the merchants that need extra data security and learn what companies like Inovio can do to help them. In his opinion, many ISOs and Sales Partners don’t realize what a good payment gateway can do for these merchants to make them a viable account. Risk tolerance, according to Cunningham, is where the rubber meets the road. “More risk tolerance equals more approvals, and with the right tools, a merchant account can be approved and stay active regardless of the level of heightened security they require,” he said. “Our set of tools turns us all back into regular business people – assessing the value of a business vs. obsessing about risk.”
Cunningham feels the right underwriter will have the right attitude. For instance, Inovio has the statistics to prove that by applying a fairly routine set of security parameters, most merchants can be set on the right track.
Cunningham also stressed the importance of using the right risk tools. Inovio has demonstrated there is less risk by measuring a control group of merchants with none of the risk tools against another group with the tools to prove the overall chargeback ratio is significantly lower when the tools are applied.
More savings down the road
Cunningham said the key to understanding how to achieve approvals and sustained accounts is for the business vertical to achieve longevity without moving further into a risk category. If the vertical and the individual merchant accounts served by an ISO are stable, this will help inbound merchants save and/or make more money down the road. The ISO’s merchants further benefit from not having to shop for another merchant account later on after sustaining a bad payment history, which means they can simply continue to focus on making more money.
This makes companies like Inovio a more attractive option for merchants who need to get their security and account risk factors set up right the first time -- and for ISOs who want to ensure account (and residual) longevity. “Data breaches and expensive processing due to earlier missteps can put a merchant out of business,” Cunningham concludes. “Put simply, a tarnished reputation can a make a brand no longer viable.”
To learn more about reseller opportunities with Inovio, visit www.inoviopay.com.