The advent of ECommerce digital technologies and the sales revenue generated by such businesses has benefitted global economies but attracted a lot of adversaries well. This has exponentially increased the rate at which PSPs (Payment Service Providers) are attacked. Risks and threats need to be identified, quantified & measured so they can be dealt with proactively.
5 common hurdles encountered in online payments systems:
- Chargebacks: The “card-not-present” transactions indicate a fraudulent usage of payment networks and data theft. However, fraud-monitoring tools detect the same but deploying EMV (Europay, MasterCard® & Visa®) embedded chip & biometric authentication technologies are advisable. Too many chargebacks not only damage the business reputation but often the merchant closes its accounts. Deploying effective customer service and customer checks substantially reduces frauds and chargebacks.
- Domestic and international transactions: National banking infrastructures require Private PSPs to enable cross-border transactions facilitating global trade. Government-led initiatives & mandates have regularized payment processors which were initially slow levying expensive transactions service charges. Managing credit risk, liquidity of assets, outsourcing business and professional services, and cost-to-benefit analysis for MNCs (Multi-National Companies) is now easily handled by transnational PSP systems.
- Cyber-attacks: PSPs face DDoS (Distributed Denial of Service), phishing, vishing, smishing, e-skimming, etc. attacks. It is advised to subdue the application, network, data, & infrastructural security risks by following Defense-in-Depth and Depth-in-Defense approaches. Enforce the Security CIAAAN and comply with various physical, technical, tactical, operational procedures. Getting complied with regulatory compliance frameworks and standards increases your business reputation and customer acceptance. Implementing PCI-DSS, GDPR, ISO’s OSI model, HTTPS-SSL-TLS ensures the Credibility of your firm’s Security posture to your partners, merchant vendors, & customers.
- Domestic & foreign currency payments: Merchants initially required different bank accounts and business entities as per the national/regional market. But nowadays, PSPs facilitate merchants, retailers, and customers paying in regional currencies increasing multi-currency, cross-border transactions.
- Technological workflows: With digitization, integrating various technologies across the world to function & operate with common objectives faces a few difficulties as well. Payment processors need to deploy good security mechanisms which of course is expensive for merchants to bear its costs. The PSP has to roll out its own hardware and software that facilitates secure payment transactions between merchants, retailers, & customers. The seamless, safe and secure payment experience has its costs that the end-users have to bear.
5 Best practices to deal with online payment security risks:
- Educate employees: Employees and partners need to understand the bigger picture of business risk. Everyone must take moral ownership to keep the risky online payment business safe and secure in their individual capacities. User awareness training must be conducted to prevent the staff from getting targeted by social engineering attacks.
- Prevent, detect, and mitigate risks: Ensuring cybersecurity and secure data practices is the first step to preventing imminent risks. Detection & mitigation is strengthened by deploying in-house SOC (Security Operations Center) and/or NOC (Network Operations Center) or outsourcing them to MSSP (Managed Security Service Providers).
- KYC and compliances: Complying with the various regulatory standards & compliance frameworks shows credibility to business partners, merchants vendors, clients, customers, and likewise. Adhering to Data privacy laws is very much recommended.
- Conducive company policies: The online payment shipping, returns, refund amount, data privacy policies must be well stated over the online platforms that the Users use every day. Satisfaction, convenience, and security of customers must be prioritized.
- Risk modeling: Risks & threats must be assessed beforehand. The relevant BCP (Business Continuity Plan), as well as DRP (Disaster Recovery Plan), must be clearly defined. Frauds must be dealt with strict legal actions to instill fear in fraudsters and maintain or improve business reputation in the market.
To know about Online Payment Security solutions for business, call Centex Technologies at (254) 213 – 4740