A Definite Guide to PCI Compliance

PCI - DSS for Payment Gateways

Share this post
5 min read

Cashless payments are becoming exceedingly common, and guess what else? Customer data breaches. The rate at which such breaches keep increasing is alarming. In the last 2 years alone, PrivacyRights.org recorded 5,361 breaches, of which 3,724 were unique data breaches.

All the reasons why it is important to protect customer data and reinstate trust in online payments. Visa, Mastercard, American Express, Discover, and JCB came together to make this happen back in 2006. Though they had their individual security standards for companies with access to credit card data, they formed the Payment Card Industry Security Standards Council (PCI SSC) to amplify their effect.

Together, they penned down a standard PCI data security measure, otherwise referred to as PCI Data Security Standards (PCI DSS). Keep reading this article to understand how PCI compliance ensures customer and bank data protection.

What is PCI DSS?

PCI DSS draws out a common threshold for security standards that are a must for companies accessing a cardholder’s data. Companies that either use or operate with sensitive customer authentication data, or, in short, integrate with card payments, have to oblige. 

PCI DSS is nothing but a set of protection measures that help fight fraud and data breaches to secure customers.

Components of PCI DSS

Three components make up the PCI DSS that companies must follow to be compliant:

  1. Data intake - PCI DSS has 300+ security controls for business models that are configured to deal with customers’ data while accepting payments. Such models must also deploy security software and hardware. On the other hand, models that can function without direct contact with sensitive card data shouldn’t have access to the data. Because their model is integrated with a third-party solution provider, they will handle all the PCI DSS requisites. Just a bunch of security controls, like the requirement of strong passwords, would do the job. 
  2. Safekeeping - Over 300 security controls apply to data storage as well. So, companies must separate the systems, people, technology, and processes involved in card data transmission, aka the cardholder data environment (CDE), from the rest of their business operations to easily validate them. If not, each and every system involved in the process must be PCI validated, which is expensive and time-consuming. 
  3. Annual validation - companies with access to customer card data must obtain PCI validation every year. PCI-compliant organizations face no bottlenecks in multiple situations with payment processors, business partners, and customers. The PCI-compliant form is proof of security and trust, making it easy for you to tie up with payment processors and partner with businesses. 

Also read: Cybersecurity in Digital Payments

What is the purpose of PCI DSS?

Let’s get a broader view of why PCI compliance came into existence. Here’s a breakdown of all the purposes PCI DSS fulfills:

1. Card data safety 

The standard protocol sets the security foundation for cardholders' data. Data that leads to unauthorized access, theft, and fraudulent activities when in the wrong hands. It comprises all card information used to make payments.

2. Secured transactions

PCI DSS benchmarks some requirements to ensure all transactions done are safe and secure. Some examples of the requirements are, companies must encrypt cardholders’ data, store it with utmost safety, and take measures to fight fraud attempts.

3. Safe and secure network

Network security is another critical aspect of securing customers’ data and, hence, is a requisite of PCI DSS. The standard protocol requires companies to keep strong network security like firewalls, intrusion detection systems, and regular security testing. Such security leaves no weak points for cyber threats to get into the system

4. Control access to data

Not only must organizations leverage technology to safeguard customers’ data but also follow procedures. One of the many procedures is limiting access to employees, and keeping it strictly on a need-to-know basis. The protocol also suggests companies assign IDs to employees with access to sensitive information and maintain a database. It is important to protect your customers from outsiders as well as insider threats.

5. Constant network monitoring and testing

Besides implementing network security, companies must as well constantly monitor and test how well they work. Necessary upgrades or modifications must be made if necessary, to keep any chance of a breach at bay. Companies must constantly make efforts to improve their security system.

6. Secure policies and procedures

With the best interest and knowledge, companies must develop security policies and procedures. These policies also educate employees on the right way to handle customer data. It could simply be a layout of terms and conditions to govern, handle, process, and protect card data.

What are the consequences of non-compliance?

Stick to the PCI compliance checklist for the best of your interest and benefit. Otherwise, multiple financial, legal, and business losses will haunt you. Find some of the many consequences of non-compliance below:

1. Financial penalties and fines

You need to integrate with the card network providers to stay in business, and if you violate their rules, they impose penalties. You will have to pay penalties in thousands or even millions for greater damages. Other financial constraints include a loss in revenue from non-payments, acquiring bank fees, or, if worse, legal fees. Plus, acquiring banks charge higher transaction fees from non-compliant companies for security risks.

2. Loss of customer trust and reputation damage

With the increasing number of security breaches and unauthorized access, customers are now more cautious about their sensitive data than ever before. PCI DSS non-compliance represents an inability to protect sensitive data and leads to high client turnover. Besides, breaches in cardholder data security are a big blow to an organization’s reputation, which ultimately affects the bottom line.

3. Legal liabilities and lawsuits

Any security breach arising out of non-compliance leads to legal action and lawsuits. Also, PCI DSS non-compliance is a threat to security and may force customers, partners, and regulatory bodies to take legal action. 

4. Business disruptions and operational challenges

Non-compliant companies have a hard time tying up with payment providers, banks, and legal authorities. Even when done, they face constant and rigorous audits that are a barrier to smooth operations. Other operational disruptions include any instant call out from the PCI SSC, a high likelihood of breaches, and non-compliance barriers. In the event of any bottlenecks, companies have to take a break from core business operations and handle compliance or security risks.

Which challenges do organizations face in PCI DSS compliance?

If you remember, the 300+ security controls are not the only challenge you will face for PCI DSS compliance. Other compliance norms can get complex based on the size and type of your business organization. 

1. Cost considerations

You need a lot of funds to get started with the process, to begin with. Some of the many expenses at your disposal are software & hardware costs, as well as infrastructure upgrades. Then, you need special staff to help you adopt the compliance measures and stay compliant thereafter. Plus, you need to keep training your staff and reassessing your procedures regularly.

2. Complexity of compliance requirements

There are over 300 security controls that an organization must note, understand, and also implement. The standards are pretty complex to grasp and might get difficult to adopt without expert assistance.

3. Evolving threat landscape

The evolution of technology and threats go hand in hand. New scams and threats keep popping up, no matter the attempts to mitigate security risks. It is always a challenge to ensure customer's payment card security, even with all the technology and expert assistance at their disposal. Additionally, the PCI SSC keeps updating the terms and conditions for PCI compliance, and staying updated is a big challenge.

4. Strategies for maintaining ongoing compliance

The PCI compliance checklist is not a configure-it-and-forget system. You cannot just get a PCI-compliant certificate and stay compliant forever. You must constantly monitor, improvise, and maintain the standards to stay compliant. Some of the strategies you can use are regular security scans, vulnerability assessments, and updating security policies. You can even take a step ahead and come up with your own strategies to safeguard your business and customers.

5. Regular security assessments and audits

Assessing and regularly auditing security is a must as per PCI DSS. To make it easy, companies generally deploy CCM tools that help automate regular audits. They also help report the issues, if any, and run an initial diagnosis. 

6. Employee training and awareness programs

Training employees who deal with cardholder data is critical. It is a big challenge to train and prepare employees on PCI standards. Any errors and gaps in training create confusion about responsibilities, processes, and the seriousness of PCI compliance. Even with adequate training, it might take a lot of work to stay in the loop about the changing PCI requirements. 

7. Engaging with qualified security assessors (QSAs)

As you already know, there’s a validation process that each organization must go through every year. This process is extensive and has a lot of requisites that not everyone can understand. Some audits require the assistance of Qualified Security Assessors (QSAs) or internal security assessors who help with documentation and evidence. 

8. Implementing continuous monitoring and incident response procedures

It is in the best of your interest to implement continued monitoring and response measures. You can do it with CCM tools. Customize this documentation to fit with the current PCI DSS standards, which are constantly revised. Also, create a process for incident response so any incidents are immediately notified and addressed. Draw clear timelines for reporting security breach incidents, how soon they should be rectified, and the follow-up steps to them as well.

What are the steps you need to follow for PCI compliance? 

Let’s make it easy for you to get into the process right away. This section explains the step-by-step process you need to go through to achieve PCI DSS compliance.

1. Check your business requirements 

There are multiple requirements and standards of compliance depending on an organization’s nature and size. Another differentiating factor is - the amount of cardholder data your business deals with in a 12-month time duration. Check the 4 level compliance requirements to understand what applies to your business and note them down. There are further categorizations as well, check them all out. 

2. Streamline data touchpoints

The next step in the PCI DSS compliance process is to understand the touchpoints of cardholder data with your systems. You must understand the interaction of this data, how the interaction happens, and its placeholder. Map out the entire interaction with systems, network connections, and applications. Seek help from your IT and security teams to streamline these interactions and record them. 

Some examples of interactions include:

  • Customer-facing areas of business like payment terminals.
  • How this data is handled within your systems, like its storage and people with access.
  • Internal systems and technology in connection, like network systems, data centers, and cloud environments.

3. Deploy security controls

Now that you are aware of and have streamlined data interactions, it is time to deploy the security protocols stated by PCI DSS standards. There are multiple security controls in place to address the data flow. These controls are impactful strategies/requisites for data security that a business can use to protect customer data. 

4. Track to uphold compliance

The process of security, the requirements, and the interactions with customer data will not remain the same. It will evolve with better practices, innovation, and technology. So, the measures to secure this customer data will change as well. Keep notes of the credit card networks and the PCI SSC requirements. For example, sometimes you are required to submit reports quarterly, while validation is a year-on-year necessity. Bring your security, technology/payments, finance, and legal teams together to tick the PCI DSS compliance checklist and achieve compliance.

If the PCI DSS compliance process sounds like a big deal, PayBy is your solution. There is a way to avoid going through this process. Companies can choose a payment gateway like PayBy that uses a hosted payment field. 

So, any sensitive data that customers enter is stored on PCI DSS–validated PayBy servers, not your organization’s. So, your organization will not deal with the data. Instead, a token is assigned to each payment, which can be used for further transactions as an alternative to card data.

Be PCI DSS compliant always with PayBy. Get started now!

Want to know more about cashless payments or how it benefits your business growth?

A person holding a smart phone in their hand.

See All Guides

Open Banking Explained

July 19, 2024
5 min read
This is some text inside of a div block.

A Definite Guide to PCI Compliance

June 19, 2024
5 min read
This is some text inside of a div block.

A Detailed Guide on the Wage Protection System in the UAE

June 18, 2024
5 min read
This is some text inside of a div block.

Complete guide on Banking as a Service

June 18, 2024
5 min read
This is some text inside of a div block.