Entries tagged with “Data Security”.


Real-time payment processing systems have already been successfully implemented in multiple countries around the world and will soon be implemented in the U.S.  According to an article by Tom Gorenfeldt in Forbes, “The Federal Reserve Banks and the Federal Reserve Board are evaluating potential strategies for collaborating with the industry to achieve real-time payment capabilities. The final consultation report, ‘Payment Systems Improvement Roadmap,’ has been delayed repeatedly but is expected out before the year’s end. It will define action plans to achieve faster payments capabilities in the U.S.”  Customers, businesses, and banks alike will need to learn about the benefits and potential pitfalls of real-time payment processing.

Benefits

In an increasingly digital world where a company might exist totally online, a person could theoretically buy something, have it shipped, and receive it all before their payment is completely processed. Lag in payment processing time can mean that customers could easily overspend their accounts. Lag in payment could also severely hinder some businesses, particularly when they are crossing time zones. “Merchants like to restock once they sell, and the time it takes to get the proceeds of their sales can create cash flow management issues for them. The impact of that latency just moves up the supply chain,” said Rich Koehler, Director of Product and Marketing at Amazon, “When we look at payments in the future we should look at it as an enabler for new business models.” Real-time payments can help eliminate some of the issues that come with that lag in payments. While online businesses operate 24/7, banks don’t, which may have to change as real-time payment processing in the U.S. starts to become a reality.

Making the Change

While some businesses are completely ready for a more reactive payment processing system, some banks just can’t justify the cost of switching to a real-time payment process. However, with new direction from the U.S. federal government and so many other countries already operating with real-time payment systems, their philosophies could soon change. According to the same Forbes article, The Clearing House “plans to undertake a multi-year effort to build a real-time payment system to better meet consumers’ and businesses’ expectations in an increasingly digital economy. The real-time payment system will be designed to address gaps in payment processing and will enable consumers and businesses to securely send and receive immediate payments directly from their accounts at financial institutions,” and banks will need to keep up.

Pitfalls

Although a real-time payment system has a lot of benefits, businesses need to be aware of potential pitfalls. As businesses and banks begin developing a real-time payment system, they’ll need to develop a real-time fraud prevention system. The way fraud prevention operates now, banks and credit card companies rely on the day or two it takes to fully process a transaction to help identify and rectify fraudulent transactions. But if real-time payments truly are the future, then real-time fraud protection that could stop an unauthorized transaction in its tracks needs to be developed as well. The U.S. implementation of EMV cards will help decrease the risk of fraudulent transactions, but that doesn’t mean companies can completely abandon their fraud detection and prevention measures. They’ll need to evolve to encompass every new change.

While the U.S. might not be totally ready to implement real-time payments, businesses, banks, and customers alike can start preparing themselves for the changes real-time payment processing will mean.

About ProPay

Since 1997, ProPay has provided simple, secure and affordable payment solutions for organizations ranging from the small, home-based entrepreneur to multi-billion dollar businesses. ProPay is a leading provider of complete end-to-end payment security solutions that reduce, and may even eliminate, an organization’s risk of having sensitive payment data compromised. ProPay can help you:

  • Enable merchants to quickly begin accepting credit and debit cards through instant underwriting
  • Secure payment data
  • Reduce compliance obligations
  • Reduce overall transaction costs
  • Enable companies to ACCEPT and MAKE payments in multiple international currencies

As a small business owner, you need to know about every little thing that happens in your company. You need to know about inventory, profit margins, marketing, and employee retention to name a few. Whether you accept payments online, with a smartphone, or in a brick and mortar store, accepting payment from customers is a vital part of becoming profitable. Here are three payment terms you should know.

1. Chargebacks

Chargebacks happen when customers file a dispute with their bank or credit card provider about a charge they disagree with. The disputed charge might be a result of technical or clerical error (being charged twice or charged the wrong amount) or it might be a quality issue, where the goods received are not what was purchased. The most common reason for a chargeback, however, is a fraudulent transaction. Chargebacks can protect customers from fraud, identity theft, and error, but if they are abused they can cause problems for your business. To avoid chargebacks you should gather detailed information from the customer, (billing address, shipping address, etc.) and be as accurate as possible in all your record keeping. Providing fantastic customer service and making your customers fully aware of your return policy can also help prevent chargebacks.

2. EMV/Chip Cards

EMV stands for Europay, MasterCard, and Visa who banded together to set standards for authenticating credit and debit card transactions. Together they formed a company called EMVCo that promotes the use of “smart cards”. Smart cards contain a micro-chip that can hold far more information than a traditional magnetic stripe. Because a smart card can hold more information, they can support multiple methods of authentication, making them more secure than a magnetic stripe alone. Instead of relying solely on matching a signature with a card, EMV cards require the use of a PIN. This PIN can be authenticated either online, with the PIN being encrypted and verified in real time, or offline, with the PIN being verified by the EMV card itself. While EMV cards are far more secure than the standard magnetic stripe cards, that doesn’t eliminate the need to have data security. EMV cards are common in Europe, and are becoming more common in the U.S. In October 2015, several major credit card providers including American Express, Visa, MasterCard, and Discover will be implementing a liability shift for point of sale terminals. This liability shift means that merchants and card issuers not using EMV compliant cards assume liability for all fraudulent transactions. If you want to be on the cutting edge, you might consider figuring out how to accept multiple payment methods, so you can still accept magnetic stripe cards as you and your customers upgrade to the more secure EMV cards.

3. Magnetic Stripe Cards

Magnetic stripe cards are the most common type of card in the U.S. However, since these cards rely on a visual authentication via a small hologram and the cardholder’s signature, these cards are far from secure. These cards are easily counterfeited and far more likely to result in security breaches so it is vital to secure your financial information to protect yourself and your customers. A good payment processor will keep customer financial data secure, even with the less secure magnetic stripe cards. While magnetic stripe cards are far from the most secure method of payment, they are still the most common payment method, so you can’t just default to accepting only the more secure types of payment. New payment methods like the EMV card, Apple Pay, and Google Wallet are becoming more and more common. Being able to accept these newer, more secure forms of payment while still accepting magnetic stripe cards is becoming a necessity.

Knowing these three vital payment processing terms can help you protect yourself and your customers’ financial data. It will also keep you on the cutting edge and help you know how you need to prepare for the future.

About ProPay

Since 1997, ProPay has provided simple, secure and affordable payment solutions for organizations ranging from the small, home-based entrepreneur to multi-billion dollar businesses. ProPay is a leading provider of complete end-to-end payment security solutions that reduce, and may even eliminate, an organization’s risk of having sensitive payment data compromised. ProPay can help you:

  • Enable merchants to quickly begin accepting credit and debit cards through instant underwriting
  • Secure payment data
  • Reduce compliance obligations
  • Reduce overall transaction costs
  • Enable companies to ACCEPT and MAKE payments in multiple international currencies

An important aspect of fraud prevention in your business is protecting against outside threats. Hackers are often able to find out your information by preying on unsuspecting employees. Smart businesses don’t put themselves in a situation where a simple conversation could lead to data breach. Most hackers are primarily interested in financial data. But before they get there, they know it’s easier to hack into email and social media accounts. According to a recent Entrepreneur article, they’ll try to trick your employees into giving them this information:

“Hackers use techniques that take advantage of an unwitting insider. They can use LinkedIn to find out the names of your administrators and the systems they use, and then send a spear-phishing email to hijack their credentials.”

We urge businesses to take steps to protect their data. This starts with your website and online accounts and extends to your financial data. Even if you take no other steps regarding network security, you need to protect your financial data. If a hacker finds out your customers’ financial information, then he can ruin your business in a matter of hours. If you store, transmit, or process cardholder data, then you increase your risk substantially. If you remove this sensitive cardholder data from your systems you reduce your risk substantially. You should consider working with a payment processor that make securing data a top priority. In addition to giving you more options in terms of accepting payment methods, payment processors also secure your financial data.

Your fraud prevention strategy shouldn’t end with payment processors, but it’s a vital component of how you protect your business. To talk more about fraud prevention for small businesses, please feel free to contact ProPay. Call 888-227-9856 or email marketing@propay.com.

At least one, and possibly two, cybersecurity breaches have recently affected one of the nation’s largest wealth management firms.

A new financial advisor, recently promoted after undergoing years of training, stole customer information from the firm’s data system. More than a quarter of a million clients of the firm had their names, account numbers and the amount of money in their accounts posted on an online data sharing site, with a subsequent offer to sell the information for a particular amount of bitcoins (online digital currency).

The suspect in the case purportedly downloaded client information by running internal reports on the firm’s wealth management clients. He subsequently transferred the information to his own personal devices. Investigators discovered the data after retrieving the employee’s personal computer from his home.

While the advisor admits to obtaining the data, he claims he did not post it, nor put it up for sale. Some investigators have postulated that hackers stole the data after he placed it on his personal devices, resulting in two separate breaches affecting the same group of individuals.

In response to the data theft, the wealth management firm has now limited employee access to client information, so that large amounts of information regarding the firms’ clients will no longer be available to any one individual.

According to cyber security experts, a cautious approach regarding data access is the best. Rogue employees are one of the most difficult threats to detect, and a “cloak and contain” policy, allowing individuals only the amount of information they need to do their jobs, is the best way of to keep client data safe.

To learn more how to protect your customer’s credit card and payment information feel free to contact ProPay. Call 888-227-9856 or email marketing@propay.com.

Fraud prevention has the potential to be one of the most cost-effective investments your company makes. To calculate your ROI, however, you need to understand the opportunity cost associated with fraud prevention.

A recent Yahoo Finance article reports on how much UK businesses lost due to fraud. Here are two of the most important figures:

- The average amount of money lost was $4,000

- 1% of SMBs lost more than $15,500

The article also explains that all businesses, whether small or large, can be impacted by fraud. We often say that small businesses are at a greater risk of fraud since hackers know they don’t have sufficient resources to invest in fraud prevention. Hacking small businesses isn’t as fruitful as hacking banks, but it’s easier to infiltrate unprotected technology systems that small businesses often use.

A cost-effective way to practice fraud prevention and protect your business is to use encrypted state-of-the art payment processors. These add an additional layer of security when your clients pay with credit cards. Moreover, you get to track payments in case someone tries to scam your business. The important thing is that you choose a payment processor which fits your company’s needs. There are tons of payment processors out there, and they all vary in terms of features and functions.

We recommend taking your time and researching a few payment processors until you’re completely satisfied with one. Feel free to reach out to if you have any questions about technical specifications.