Data breaches, hacks and credit card fraud occur on an alarmingly consistent basis, and that trend shows no signs of abating. Whether it’s caused by carelessness, data break-ins, or even ransomware, this criminal activity costs billions of dollars annually. With the rise of the cashless society we’re in, this type of illegal activity looks to do nothing but grow. Fortunately, there are types of standards and practices that can be enabled to help prevent this type of cybercrime.
What Is PCI DSS?
PCI DSS is an acronym for the Payment Card Industry Data Security Standard. It is a set of standards, formed by a number of leaders in the credit card and financial services industries — American Express, Visa, MasterCard, Discover and others. It is overseen by the Payment Card Industry Security Standards Council (PCI SSC), and its goal is to prevent fraud in the credit and debit card space. One of the PCI SSC’s missions is to dictate standards for businesses that accept cards as payments. These standards include the use of firewalls, data encryption, and anti-virus software, among others.
Origination of PCI DSS
PCI DSS was established in December 2004 by the PCI SSC (Payment Card Industry Security Standard Council). The PCI SSC consists of five big names in the industry – American Express, Discover Financial Services, JCB International, MasterCard and Visa. It created PCI DSS in response to the rise in credit card fraud in the late 1990s/early 2000s. Previously, various credit cards had their own sort of security standards for years, which was confusing for merchants who accepted multiple types of cards. The idea of PCI DSS was to establish a uniform method to regulate security among merchants and service providers.
How It Works
Simply put, PCI DSS requirements are all about the way that sensitive financial data (and the networks that process them) is handled. Any merchant that accepts credit and/or debit cards must comply with PCI Security Council standards. These best practices include the maintenance of secure networks, protection of cardholder data and the secure monitoring of the network. This not only protects your assets and the confidential data of your customers, but it is also important for your reputation as a secure, trustworthy institution.
Why It’s a Standard in the Industry
Due to the nature of the credit card industry, there is plenty of room for fraud, theft and other types of cybercrime. Merchants and other businesses are grouped into segments to combat such crime, and these segments are dependent on the volume of transactions that are processed monthly. Requirements include standards for the following:
- Secure networks: A firewall is required, and the use of the vendor’s device default password and other security settings is not allowed.
- Secure cardholder data: All stored cardholder data must be protected and encrypted when transmitted over public networks.
- Vulnerability management: Antivirus software must be installed, monitored, and updated regularly.
- Access control: A unique sign-in is required for all users with computer access, and physical access to cardholder data is restricted.
- Network monitoring and testing: All access to the network and cardholder data is to be monitored and tracked, and all security systems are tested on a regular basis.
- Information security: A uniform information security policy for all employees and contractors needs to be established.
The Role of PCI DSS in Financial Services Industries
PCI DSS is not a legal requirement, but any business or financial institution that avoids its compliance will diminish the confidence of its customers. In addition, they will lose protection from potential legal action in the event of data breaches, and that includes fines up to $100,000. Its role is to protect cardholder data, secure the processing system and maintain trust with its customers and stakeholders.
Virtual Data Rooms and PCI DSS Requirements
A virtual data room (VDR) has always been an indispensable tool for financial institutions for any merger and acquisition (M&A) transaction, due to its security, ease of use and ability to save money and time during a prolonged business deal. Those same qualities are important for banks and other financial institutions, as security and ease of use are paramount, and, just as important, because many of its transactions are performed virtually. Both commercial and investment banks make use of PCI DSS compliant VDRs for many types of transactions, including various types of M&As, strategic partnerships, IPOs, and for conducting due diligence, among others.
A VDR provider should be a trusted partner in these types of transactions and supply the appropriate tools required. Knowing what a VDR is capable of, and how it’s used in your banking or financial transaction, is vital knowledge. A secure and sophisticated VDR includes a user-friendly interface, enterprise-level encryption, high-level security, customizable permissions and 24/7 customer support. CapLinked, an industry leader in the VDR space, provides all these tools and more and can help save time and money in any of your financial transactions. Start a free trial with CapLinked today.
Chris Capelle is a technology expert, writer and instructor. For over 25 years, he has worked in the publishing, advertising and consumer products industries.
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