Improve Your Payment Environment Security With Payments Orchestration
Keeping payment systems secure is a primary concern for merchants. Technology and payment leaders know that fraud can happen at nearly any point in the transaction process. Major vulnerabilities along the transaction pathway include improperly stored card information, malware, and outdated software. As retailers seek to incorporate new payment types, including emerging and alternative payment methods, each additional payment type represents an increase in payment system complexity and a rising risk of data breach occurrences and data theft.
Security breaches pose a serious threat, potentially putting your business and customers at risk, thereby decreasing customer trust. Consumers want to know that the brands they trust with their business have robust payment system security. As fraud risks advance and become stronger, combating them can consume more time and resources. Merchants need a payment system security solution that prioritizes transaction security.
To decrease the risk of loss, merchants must implement payment system security features, products, and services that protect customer information and insulate their payment systems from security risks. A payment orchestration partner can help businesses improve their payment processes by enabling greater payment system security. At OLS, our innovative and secure technology drives all forms of payments commerce, reduces your PCI scope, and protects your payment systems.
CONSIDER WHAT THE USAGE OF ACQUIRER-PROVIDED SOLUTIONS MAY DO
A large retail chain wanted to move away from an encryption security scheme that had them locked into a specific payment processing company. This security product consisted of a proprietary encryption solution that involves scrambling the credit card number from the point of entry through to the processor.
With this security product, software was installed on the merchant’s POS terminal that would encrypt the data, including the PAN (primary account number), creating the data string of a new card which was then sent in an encrypted block to a processor. This is often referred to as “End-to-End Encryption” because the data is encrypted at the first possible moment and not decrypted until it reaches its final end point. Because the payment data is encrypted during its entire journey to the processor using the processor’s methodology, this data cannot be analyzed, made available to additional service providers, or accessed in any other way. While this may provide a high level of security, it can also be restrictive to the merchant’s overall data needs and may increase expenses by necessitating the use of an additional processor service that provides unencrypted access to transaction data. It also increases the difficulty in changing processors and virtually eliminates the possibility of multi-processor connections.
THE NEED FOR CREDIT CARD DATA PORTABILITY
By moving to a Point-to-Point Encryption solution with OLS as their payment orchestration partner, OLS was able to provide them with a similar method of security but with more independence. Working similarly, OLS provided the merchant with a security solution where card data was encrypted at the terminal with an OLS key. That encrypted data would go into the OLS system, where it would then be decrypted and finally sent to any payment acquirer or other service provider for processing.
1 Credit Card used for purchase
2 Encrypted with OLS key at the terminal
3 Sent to payment acquirer for processing
With the OLS solution, and without being tied to one provider, the merchant could now take their payment traffic and split it up in a manner that best suited their business. Not only could they change processors, but they could also add additional processors. By taking over the security encryption and moving the merchant away from a processor-provided solution, OLS enabled the merchant to have a greater level of independence while still providing them the point-to-point encryption at the store levels needed to reduce their PCI scope. OLS helps merchants connect to a broader range of acquirer and third-party service provider relationships and choose the best-in-class options that optimize their business.
AVOID BEING TIED TO ONE PROVIDER WITH PAYMENT ORCHESTRATION
Acquirer-provided solutions may seem easy on the surface, but there are drawbacks to this type of integration. The use cases presented deserve consideration, from contractual obligations to blocking a merchant’s data.
For the large retail chain previously mentioned, having their security handled through an acquirer-provided solution meant they didn’t have access to any of their payment data beyond typical transaction reconciliation data. The data was locked down when it entered their payment system. If they wanted access to it, the retail chain would have to execute another separate contract with the payment processor to acquire the information needed for data analysis.
In many cases, a processor may try to convince the merchant that they are protecting the merchant by locking down the data. But, as business analysts become savvier, brands want access to their data. Insights into the customer journey are particularly useful from a marketing, sales, and management perspective. Too often, merchants are blind to some of their processing as that encrypted data disappears into a payments abyss.
Yet, payment data is a key driver of business efficiency. Businesses need payment data that offers insights into customers’ behavior and allows them to pinpoint any problems in their payment process. Payment data helps companies see the big picture when it comes to payment activities–from the ability to identify transaction issues to detecting fraud. Payment data also provides insights into individual transactions, linking transaction data and allowing a business to see the entire customer journey. With access to this actionable data, they can monitor and adjust their payment systems to make improvements and gain a competitive advantage.
Payment orchestration provides merchants with increased flexibility for their business. Merchants often want to work with the payments-related service providers that make the most sense for their particular business. The OLS solution has the power to add integrations to all kinds of service providers, such as fraud management, data analytics, loyalty program providers, and third-party delivery. OLS provides merchants with an omnichannel payment solution that expands current payment capabilities while enhancing payment security. Brands are shifting management of payment complexity to the OLS solution.
ENHANCE TRANSACTION PROCESSING SECURITY AND COUNTERACT TRANSACTION FRAUD
According to the Nilson Report, credit card fraud losses, which reached $28.58 billion worldwide in 2020, will reach $49.32 billion by 2030. In addition, the United States accounts for a more significant percentage of global card fraud than total card volume. Merchants are facing internal and external fraud risks, with fraud potentially occurring at nearly any point in the transaction process. These fraud risks are constantly advancing and becoming stronger.
Retailers have been victims of malicious software installed on their POS terminals, allowing fraudsters to capture card numbers. Outdated system software, or lack of system maintenance, leaves merchants open to vulnerabilities that hackers can exploit. While that still occurs, a newer form of fraud involves a BIN attack.
Attacking the BIN refers to a fraudster taking the first six digits of a card and then running software to generate the rest of the numbers. A merchant or payment processor may see 50,000 transactions in an hour as the fraudsters generate a usable card number and approval.
Payments orchestration can help merchants enhance transaction processing security and counteract transaction fraud. Both critical security components, encryption is converting information into an unintelligible form except to holders of a specific cryptographic key. At the same time, tokenization is a further way to safeguard customers’ personal information and limit exposure to hackers.
SECURITY BREACHES CAN LOWER CUSTOMER TRUST AND CAUSE SIGNIFICANT REPUTATIONAL DAMAGE
The magnitude of a security breach is both long-lasting and far-reaching. The intangible reputational damage, in particular, can linger indefinitely. When customers hear of the data breach, many may react by choosing not to use a credit card with that merchant or simply not shopping with that merchant out of fear. In most states in the U.S., a business that has suffered a breach must notify anyone whose data was compromised, further adding to the costs and burdens associated with a data breach.
As your payment orchestration partner, OLS will help merchants ensure that their customers’ data is protected by following payment security protocols such as PCI Compliance. Integral to payment security, the Payment Card Industry Security Standards Council (PCI SSC) standards were founded in 2006 by the largest global payment networks. PCI issues security standards to guard against
credit card fraud, including the Payment Application Data Security Standard (PA-DSS), to ensure that businesses do not store prohibited secure data, such as magnetic stripe, CVV2, or PIN. The OLS platform supports an ever-expanding set of payment types and channels in a secure environment that complies with the PCI DSS and PA-DSS requirements.
In addition to PCI compliance, OLS maintains a Service Organization Control (SOC) report. While encompassing an organization’s internal controls relevant to the security, availability, processing integrity, confidentiality, and privacy of customer data, third-party SOC reporting assures businesses that OLS has the appropriate controls to protect customer financial data.
PAYMENT ORCHESTRATION IS BUILT FOR SECURITY
As merchants expand their payment capabilities, each new addition increases payment system complexity as well as the rising risk of data breach occurrences and theft. These security risks pose a severe threat, consuming significant time and resources. Merchants need a payment solution that provides features that protect customer information and insulate their payment systems from security risks and fraud.
Payments orchestration can help merchants enhance transaction processing security. OLS Payments provides merchants with access to enhanced security functionality, including the most recent tokenization and encryption security updates – both critical components for keeping payments secure and protecting cardholder data. Compliant with the latest PCI and PA-DSS requirements, these security solutions can reduce PCI scope and provide relief from breach notification.
OLS GIVES PAYMENT AND TECHNOLOGY LEADERS A STREAMLINED PAYMENTS PROCESSING SYSTEM THAT:
- Prioritizes transaction security from the beginning
- Enables flexibility and efficiency with a modular design
- Supports future-ready and cost-effective scaling
With highly accessible open APIs, decades of payments expertise, and our focus on customer success, our solutions let you increase functionality and shift the management of payments complexity to us.
Taking a proactive security-first approach to the payments system allows merchants to focus on mitigating potential security problems before they cause irreparable damage. With OLS Payments, you get a best in-class payments partner and a dedicated team of experts to handle deployment, scale, and management, saving your team time, frustration, and costs. Learn more about how we can help you today.