Securing online transactions should be a key focus for eCommerce merchants. One hacking event can cost an online retailer millions in revenues, customer loyalty and branding. It can even cost you your business.
However, knowing what you should be looking for with a provider is an important step in understanding how to protect your business. Securing transactions is complicated; its more than a certificate.
Payment gateways provide levels of security, and accept liability, for their online clients. A good payment gateway secures data that is transferred to your payment processor for authorization when a customer makes a purchase. This process ensures that the gateway is secured from interception by hackers.
Payment gateways ideally:
- Ensure merchants are paid at the time of purchase, reducing credit or fraud risks
- Include buyer protection
However, there are some standard features you need to look for when researching providers.
3 Features of Every Secure Payment Gateway Provider
Point-to-point encryption
Point-to-point encryption (P2PE) is one of the best ways to protect customer transactions. The digital communication that takes place from the moment a customer swipes, inserts or taps their card leaves a merchant vulnerable to fraud. Secure payment gateways use P2PE to protect data from interception as it’s passed from a merchant to a payment processor.
P2PE reduces risk:
- loss of cardholder data
- brand reputation in a data breach,
- fines for compliance failure
- lost revenue from fraud
Tokenization
Tokenization substitutes an actual credit card number with a randomly generated string of characters, a one-time code associated with the transaction. This code or “token” can’t be traced back to the cardholder, and the numbers are meaningless to anyone trying to read them without the decryption key.
Following a data breach, hackers can’t decode these numbers into real values, so choosing a payment gateway that offers tokenization reduces the risk of payment fraud through the use of stolen data.
Tokenization also protects merchants because customers’ card data is never saved on their networks. It’s another way a secure payment gateway takes on the risk for the merchant. If merchants aren’t holding payment information in their systems, there is nothing for hackers to steal.
PCI DSS Compliance
Payment Card Industry Data Security Standard (PCI DSS) guidance was established by leading credit card brands in 2006 to help merchants and financial institutions provide secure payment solutions.
Some of the requirements for maintaining strong cyber defences under the Standard include:
- Buy and use only validated payment software at your POS or website shopping cart
- Do not store any sensitive cardholder data in computers or on paper
- Use a firewall on your network and PCs
- Encrypt transmission of cardholder data across open, public networks
- Educate employees about security and protecting cardholder data
By choosing a payment gateway, merchants don’t have to be PCI compliant themselves. A secure payment gateway offers PCI level 1 security, so the merchant can rely on the gateway for compliance with these industry-wide security standards.
Security Enhances Checkout
At one time, merchants had to integrate their own software to manage payments and security. The solution to that is a payment gateway, which acts as a third-party solution. The provider takes away the burden of software integration while giving merchants the latest and best security features.
If you are able to offer your customers a secure checkout with security options that the customer can respond to (without frustration, leading to cart abandonment) your eCommerce will see higher conversion rates. While customers appreciate the need to secure data, and respect sites that request you jump a couple of hoops to finalise a transaction, if the system is slow, too complex or even too easy, they will abandon the cart and shop elsewhere.
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