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Thursday, July 16, 2009

Confidence in data security rising

The Identity Theft Resource Center reported that in 2008, data breaches and incidences of consumer identity theft increased 22 percent over 2007. And the U.S. Department of Justice recently revealed that identity theft replaced the drug trade in 2008 as the number one crime in the nation.

However, according to the 2009 ITRC Americans' Identity Confidence Index, consumers are more confident in the safety of their personal data than in previous years. Does this indicate the intensive work done within the payments industry to implement the Payment Card Industry (PCI) Data Security Standard (DSS) might be starting to pay off?

Ben Goretsky, Chief Executive Officer of payment gateway provider USA ePay, believes e-commerce transactions have become more manageable, and payment organizations in both the virtual and brick-and-mortar world are stepping up their security efforts.

"To be an online merchant you cannot set up on a gateway that is not on the PCI list," he said. "E-commerce gateways have been streamlined, so every merchant that is processing legitimately online has to go through a certified payment portal."

Goretsky also cited the founding of the Secure POS Vendors Alliance as a positive development. The organization is "committed to making sure that security is implemented within the retail marketplace because, as a brick-and-mortar merchant, your first line of defense is your hardware," he said.

More work to do

Nonetheless, it is widely agreed among payment professionals that ISOs, merchant level salespeople and all other payments industry stakeholders still have a big job ahead when it comes to protecting sensitive transaction data. Goretsky highlighted the challenge when he asked, "How many consumers or even merchants do you know that think about or know anything about PCI?"

He added that what we "should be doing is taking the time to inform the general public that over the past however many years we have completely revamped the e-commerce industry, set the security standards, created this council [PCI Security Standards Council] that lists all the good payment organizations on their Web site, and really educates the consumer about PCI and other issues around security."

Steve Rathgaber, President of NYCE Payments Network LLC, said consumers want their data protected and are more likely to use their home financial institutions to make online purchases if those institutions "do it right."

Rathgaber added that consumer mood swings are fast and furious, but "consumers are getting better trained and figuring out what they want, and to that end, it's important to leverage the investment the banks have already made in their e-banking platforms, which are very underutilized, to add new and safer payment capabilities, increase stickiness with different reward program models and extend the depth and value of the banking platform." end of article

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