Since more commerce is conducted online than ever before, hackers will have many more opportunities to steal sensitive data, including payment card details from customers. Reputations are crucial for many internet firms, and nothing ruins a brand’s image more quickly than a data breach or a hacked online payment from a client (or several consumers).

You must understand how to safeguard your customers’ online payments in multiple ways if you want your business to prosper and remain safe. Thankfully, there are seven; let’s examine them in more detail.

Start with a Secure Payment System

The best way to protect online payments for your customers in perpetuity is to always use a PCI-compliant, secure online payment system. The payment system you use determines:

• How secure an online payment is from the get-go, as well as whether you comply with the Payment Card Industry Data Security Standard
• Whether customers will trust your website or brand enough to make online purchases

Therefore, make sure you use a PCI-compliant system right from the start. It’s also a good idea to purchase SSL encryption for your website. SSL encryption encrypts all sensitive data shared between your site and shoppers or customers, minimizing the likelihood of data leaks or theft.

Merchants should use Gravity Payments, which offers in-store and online secure, PCI-compliant payment systems. It’s also a great solution if you need mobile payment hardware and software so you can accept transactions on the go.

Store Customer Data Securely

As many companies learned throughout 2022, cybersecurity principles and strategies must always evolve. One of the biggest cybersecurity lessons learned over the last few years is the importance of secure data storage. Your customers’ personal and financial information must be kept safe behind firewalls and away from public access points. Otherwise, it’s at a high risk of being stolen and used to commit identity fraud, either immediately or much later.

Don’t hesitate to back up customer data regularly, either. By backing up customer data, you can restore it to your systems in the event of a power outage or some other infrastructural failure.

The more secure your customer data is, the less likely you’ll be susceptible to a data breach or some other cyber attack. A strong reputation often leads to more customers, more purchases, and a higher overall engagement rate with your brand. Therefore, storing your customers’ data securely has lots of benefits, not just one.

Keep Software Up to Date

Naturally, you should keep all of your online security software up-to-date at all times. Your firewall is only effective if it has the modern, up-to-date antivirus definitions supplied by its manufacturer. Whenever a key piece of software needs an update, update it immediately. Don’t put it off until later; by the time later arrives, you could already be the victim of a data breach or some other cyber attack.

Require Strong Passwords and 2FA

Strong passwords are a cornerstone of digital security and for good reason. Many data breaches occur because passwords are easily guessable.

Your staff members should use strong passwords and 2FA or two-factor authentication. Strong passwords include those with multiple uppercase and lowercase letters, plus numbers and symbols so they are harder to guess.

In addition, enforce strong password and 2FA requirements among your customers. That way, they’ll be less likely to have their accounts breached from their browsers or computers, too. 

Set Payment Limits

Payment limits could be wise means to protect online transactions for your brand overall. For example, you can set limits for the total number of purchases or the total dollar value that you’ll accept from an account in a single 24-hour timeframe.

By setting payment limits, you prevent cybercriminals with customers’ online information from stealing too much money at once. In this way, even if there is a cyber breach, you’ll be more likely to be alerted to it and you can minimize the damage before it gets out of hand.

Monitor All Transactions

Constant vigilance is a good policy in any security plan. To that end, try to monitor all the transactions that your business overseas and look for red flags, like larger than normal transactions, inconsistent billing or shipping information, and lots of small transactions made repeatedly over a few hours.

Furthermore, you should reconcile bank accounts every single day. Do this so you can keep a close eye on your business coffers and the balances of your clients. Again, by keeping an eye on all this information, you’ll be more likely to catch the signs of cybercrime if it ever affects your business.

Be Clear About Your Security Policies

There’s one more way in which you can protect online payments for your customers: be transparent. More specifically, you should be very clear about all your security policies and procedures upfront with every customer or client for your brand.

Include a “security policies” page on your website, or require customers to click through and accept your security procedures before making a transaction/putting an online payment through. This way, your customers understand how you store their data and why you have policies like payment limits. Customers oftentimes have questions about why businesses handle information the way they do.

Read Also: 10 Benefits of Online Payment Solutions for Small Business

If you are transparent about your policies and strategies, you’ll not only be more likely to get better customer compliance. You’ll also have higher customer trust, which translates to a better reputation and a more loyal customer base in many cases.

How to Enhance Card Payment Security for Customers

Every step of a digital transaction, from phone to contactless payments, must be safe and secure. This is where security precautions for card payments come in.

Businesses can utilize these techniques to safeguard the private and financial information of their clients when they make both in-person and online card payments. Without it, there is a chance that customers’ private information will end up in the wrong hands.

When clients provide their credit card information to complete a purchase, they are also putting their trust in your company to protect that information. They might decide to choose one of your rivals over your company if they believe you’re not handling their information appropriately. Additionally, losing their trust can be detrimental to both your financial line and reputation.

However, the primary justification for the significance of card payment security is in its ability to shield customers from fraudulent and stolen activities. Cybercriminals and con artists are always coming up with new methods to swindle people out of their money, and one way they can accomplish this is by taking advantage of them during the checkout process.

It is your duty to ensure that every transaction is secure, regardless of whether your company is now operating online and takes payments via a payment gateway or you still have a physical location and accept payments with a mobile card machine. It is very important that you assist your customers in becoming less vulnerable to fraud; otherwise, you risk fines and penalties for noncompliance or carelessness.

1. PCI DSS compliance

First and foremost, any business that takes card payments must comply with the Payment Card Industry Data Security Standard (PCI DSS). This is a set of security regulations that companies have to follow to ensure the safety of their customers’ data. These requirements include how businesses store, process, and transmit cardholder details.

PCI DSS aims to help minimise the chances of fraud by data breaches. Any business that isn’t compliant with the latest PCI DSS regulations will be risking their customer’s financial information and may be liable to a fine between £4,000-81,000 per month. The fine will be issued to a business’s merchant bank before being passed down to the business.

As new payment methods and technologies are rolled out, the PCI DSS is updated to ensure it’s still effective and relevant. 

2. Strong Customer Authentication

In September 2019, a new set of regulations was enforced to make card payments even more secure and reduce the chances of fraud. Strong Customer Authentication (SCA) is a requirement from the Payment Services Directive (PSD2) that applies to all “customer-initiated” online card or contactless offline payments within the European Economic Area and the United Kingdom.

SCA compliance requires banks to carry out certain checks to confirm a customer’s identity during the transaction journey. It’s also required for bank transfers.

It’s done by building in at least two of the following three authentication elements into the transaction:

• Something only the customer knows – a password or a PIN
• Something only the customer owns – a mobile phone or card reader
• Something the customer is – a fingerprint or face recognition

Also known as two-factor authentication, these requirements mean that customers may need to provide two of the above elements when purchasing from your business. If they fail to do so, their payment may be considered non-compliant and will be declined.

SCA doesn’t apply to all transactions, and it’s up to individual payment providers to identify which payments are considered low-risk and will be exempt from SCA. Here are a few examples which could be classed as low-risk payments that may not require SCA:

• Transactions below a specific amount
• Recurring payments of the same amount
• Payments made with a saved card on an account where a transaction has previously been made

SCA can affect both online and offline businesses. Here’s how you can meet the SCA requirements for face-to-face and eCommerce transactions:

• In-store – Chip and PIN is SCA compliant as it requires a physical card and PIN code. Contactless payments, however, may prompt customers to enter their PIN code on higher-value transactions. This is particularly useful for mitigating cases of fraud where a card has been stolen and is being used to attempt to purchase something at a physical store location.
• Online – For online stores, the 3D Secure authentication (3DS) method meets the SCA requirements. By entering a one-time passcode as well as their card details, customers will be providing the necessary two levels of SCA to confirm their identity.

3. 3D Secure authentication

The 3D Secure authentication protocol is widely recommended as a solution for SCA requirements, so we thought we’d dig deeper into it.

It applies to online payments, and although there are security measures in place without it, 3D Secure authentication adds another layer to help stomp out credit fraud. It’s also backed by big-name card issuers like Mastercard and American Express.

How 3D Secure works:

After your customer has entered their usual details (like their billing address and CVV number) but before their payment has been processed, they will be taken to their card provider’s 3D Secure page. There, they will either be:

• Asked for their banking password
• Sent an authentication code to enter

The first generation of 3DS directed shoppers to their bank’s website to retrieve an authentication code, but this added an extra step in the checkout process. To address this issue, 3D Secure 2 (3DS2) was introduced.

3DS2 requires merchants to provide additional customer information with each transaction so that banks can decide whether the person attempting the transaction is the cardholder. If the information checks out, there’s no extra security step, and the customer can continue purchasing. If it doesn’t, the cardholder’s bank can trigger the authentication step, which allows payments to be approved via mobile banking applications for a more streamlined experience.

4. Chip and PIN

This is the most common type of payment security used in card machines for card-present transactions. It’s been around since 2006, but let’s rewind to life pre-Chip and PIN…

Before the Chip and PIN method was rolled out, transactions were very different. Businesses had to take payments using a magnetic swipe, which worked like this:

1. You swipe the customer’s card through the machine.
2. They sign the receipt (yes, using an actual pen and paper).
3. You check the signature matches what’s on the card.

The problem with using a magnetic swipe was that if someone lost their card, there wasn’t much stopping someone else from fraudulently using it. All they would have had to do was forge the signature that was right in front of them. The Chip and PIN revolution put an end to all that.
Introducing the need to successfully submit the correct PIN code for the corresponding card makes card payments using a machine much quicker, safer, and more practical.

Now, this is how Chip and PIN works:

Step 1: When prompted, the customer puts their card in the machine and enters their four-digit PIN. PIN codes are set by the bank when someone first gets their card, and most people change theirs to something personal (but not obvious) and easy to remember.

Step 2: Once the PIN has been entered, it becomes encrypted data sent to your business’ merchant account. Encrypted data means the PIN code transforms into another form of code that only people with a decryption key or password can access.

Step 3: When the customer’s payment has been given the all-clear, it’ll show in your business bank account in 3 to 5 days, ready for you to access.

5. Address Verification System (AVS) and Card Verification Value (CVV) checks

AVS and CVV checks should be used for all phone payments, whether done with a card machine or through a virtual terminal.

Here’s how they work:

• Address Verification System (AVS) – You’ll be asked to provide your customer’s full billing address, and then the system will match the postcode given to the address already stored with their bank.
• Card Verification Value (CVV or CV2) – Requires your customer’s CVC or CSC (card security code) to verify the card’s details. This is either a three or four-digit number usually found on the back of the card.

The good thing about AVS and CVV checks is that they’re done in real time, so you can go ahead and accept or reject the transaction right away.

It’s important to remember that failed checks could be a sign of credit fraud. So, if you get any, in the interest of your and your customer’s safety, it’s best to decline the payment.

Conclusion

In the end, the most effective cybersecurity strategies are complex and dynamic. Cybercriminals won’t, after all, repeatedly get online payment information via the same means and strategies. Keep abreast of new cybersecurity problems and do your utmost to keep client information safe at all times. That’s the only way to guarantee that your company maintains its reputation for many years to come.