The complexities of processing credit card payments can be well-hidden but can have a massive impact on accounts.
For customers, making a credit card payment is second nature. There may be an additional charge for using it over a debit card or bank transfer, but this is often outweighed by the convenience and flexibility credit cards offer.
But what about businesses?
There are certain risks and responsibilities about making and accepting payments from credit cards that many organizations - and even finance professionals - may not be aware of.
As data protection and financial fraud continue to be pressing issues for companies - and one that consumers are increasingly concerned about - it's important that businesses of all sizes understand the implications of online payment.
Here are three things you might not know about credit card payments:
EMV vs swipe protection
Around 50 countries across the world use 'chip and pin' cards that have an EMV chip on the front, as well as a magnetic strip on the back. Most credit and debit cards issued in countries that have adopted this system have the new chip but some don't. In the age of global business, it's important that companies understand the differences between EMV technology and older 'swipe' cards when it comes to processing.
When EMV cards are used, payment is processed through tokenization. This replaces the sensitive data (i.e. the card number) and scrambles it into randomly assigned numbers to complete the transaction. It provides a further level of security because if anyone tries to intercept the payment or steal the information, they won't be able to use the token for any further crimes.
Old swipe cards don't have this protection as the payment processor relies on the magnetic strip to read your bank account information. If it is intercepted, there's nothing to stop data thieves from cloning your card or making further transactions with this information.
It's not just about cybercrime
Many organizations prioritize fighting cybercrime and ensuring that their customers' - and employees' - sensitive information is protected. While this may be a crucial element of making trusted payments, a significant number of security breaches use valid log-in details to access the information. This is why it's essential that employees at all stages of the company are involved and trained in data protection, especially where BYOD policies may also be in place.
Your data security policy is vital to ensure credit card payments can be made securely, while also ensuring you're safeguarding the sensitive information of your customers. It should incorporate response to data threats, how you gather, store, use and delete others' information, and employee behavior. This may feature a lot of actions that companies deem to be 'common sense' - like having secure passwords and changing them frequently - but it's important that all employees have the same level of information about it. If you deal with major firms, you may even lose business if your data security policy isn't up to scratch.
Picking the right payment processing tech is key
Often companies overlook what technology they're using to process credit and debit card payments, assuming that they all offer the same level of security but this isn't the case. Businesses should select a supplier that guarantees PCI-compliant processing that will be able to safeguard both EMV chip technology and swipe cards. Doing so will allow companies to equip themselves for global payments.
This ensures that there is a two-pronged strategy to protect the transaction; however, companies should never rest on their laurels. Businesses of all sizes should regularly audit themselves to establish any vulnerabilities existing within their system. This may seem like a waste of time but this proactive approach is much less damaging - in terms of time spent and potential money lost - than a data breach. Organizations should ensure that their policies and strategies concerning payment security are constantly evolving, especially during periods of substantial growth.
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