Adopting Credit Card Tokenization to Meet PCI Compliance

What is PCI Compliance?



The security and protection of your sensitive and confidential data and your clients are central to establishing and operating a business, mainly where payment processing and storage of financial information are involved. A set of regulations is stipulated by The Payment Card Industry Data Security Standard (PCI DSS) proposed by major credit card enterprises to help minimize costly breaches against customer and bank data.



Thus, PCI compliance refers to fulfilling PCI DSS regulations for sellers and organizations to aid safe and secure acceptance, storage, processing and transmission of cardholder data to stop theft and fraud during transactions.



Confidential Computing



An advisory notice was issued by the Monetary Authority of Singapore (MAS) in June 2021, highlighting the cyber security and technology risks relating to public cloud computing. The circular describes principles and standards for risk management and best practices for guiding financial institutions' implementation of proper security measures to protect data in the public cloud. This approach applies to data in motion, at rest and in use. FIs (financial institutes) may adopt confidential computing solutions for data processing or using the public cloud. This solution uses a hardware-based computing enclave protected to isolate sensitive data, offering ultimate protection.



Managing Cryptographic Keys and Securing Data






● Additional measures for data in cloud storage can be undertaken, e.g., file and data object encryption or tokenization besides platform-level encryption.


● Data object and session encryption can be implemented besides platform-level encryption for data that moves to and fro and within the public cloud.


● FIs may adopt private computing solutions if available from the service providers for data in use.



Confidential Virtual Machines (CVMs)



This article highlights a credit card payment processing solution using CVMs operating on AMD Secure Encrypted Virtualization (SEV) – Secure Nested Paging (SNP) technology. The function of SEV is to separate virtual machines from hypervisors. A unique encryption key written in the CPU is issued for individual VMs for automatic encryption of the hypervisor-allocated memory to operate a VM. In the virtualization security model, hypervisors are typically trusted and are requested by most customers to minimize vulnerabilities in computing infrastructure.



SNP capability is a feature of new generation SEV technology. This adds new hardware-based security by delivering reliable memory integration protection to the hypervisor from the risk of attacks, including memory remapping and data replay.



Users with sensitive requirements for security and confidentiality require virtual VMs. This is because they are well-suited for migrations without the need for code changes, preventing the reading or modification of your VM states. Confidential VMs have the following merits;






● Powerful hardware-based isolation between hypervisor, host management code and VMs.


● Complete-disk encryption before first boot in the cloud.


● Testimonial policies to affirm compliance by the host before deployment.


● Encryption keys for the VM customer or platform to control (not compulsory).


● Dedicated virtual Trusted Platform Module (TPM).


● Secure critical launch with a cryptographic binder between the platform's adequate attestation and the VM's encryption keys.



Credit Card Tokenization



Tokenization is a randomly generated process in which customer data is substituted with a non-predictable output that varies, even if the same input is repeated. For instance, a different token will be produced when a client makes a second payment for an item. Finally, the tokenization interface puts up the original output when remitting that random output to the application.



Enterprises can use tokenization to securely access, distribute, transfer and recover clients' credit card data. No sensitive data can be found in tokens. They instead act as maps that point to the direction within their systems where the relevant data is located. The tokenization process is irreversible and involves mathematical algorithms.



The primary distinction between tokenization and encryption is that encryption is reversible. Encrypted data may be decrypted at any time if the algorithm is known.



These are steps to the PCI compliance requirement;






● The cardholder initiates a transaction, and they enter their sensitive data.


● The merchant FI receives this information in token form.


● The token is transmitted to the credit card ecosystem for verification.


● After authorization, data is securely kept in virtual vaults and clients' account number gets matched with the token.


● Funds are verified, and transactions are validated or denied.



Nothing different needs to be done by the customers as the whole process take place behind the scenes.



What are the Advantages of Credit Card Tokenization?



Credit card tokenization significantly improves payment security. Tokenization is a guaranteed technique to keep your clients' payment information safe from both external digital thieves and possibly internal issues.



Randomly produced tokens are only accessible by the payment processor — even if they have been disclosed, they cannot be monetized. As a result, anonymous thieves and hackers have less opportunity to carry out cybercrimes when a token traverses the networks.



Many firms that gather and retain sensitive data on their networks frequently struggle to meet PCI DSS regulations. If a data breach occurs, the PCI Council may levy sanctions for failure to comply.



Tokenization enables retailers to comply with PCI DSS while incurring low liability and security costs.



By eliminating credit card information from your network, you reduce the likelihood of a data breach. As a result, you don't have to invest as much money and resources in data protection because credit card tokenization has done it.



Tokenization technology may also safeguard sensitive company data such as addresses, customer accounts, passwords and secret files.



Benefits of PCI Compliance



Protects from Data Breaches



The primary reason for PCI DSS compliance controls is to minimize security incident risks. When these requirements are adopted by enterprises – building firewalls, data encryption and data security management resources – they make it less easy for attackers to exploit sensitive information.



Client Trust and Confidence



Improved data security leads to improved relationships with customers and partners.



People are becoming more aware that cyber-attacks can happen to any organization, and they are increasingly demanding that organizations recognize the risks.



The public will be more confident in using a company's services if it can demonstrate that it takes information security seriously, which PCI DSS compliance can do.



This isn't even based on the assumption that the organization prevents all data breaches.



If an attacked company responds appropriately – especially if they follow PCI DSS Requirement 12, which specifies the steps that must be taken in a security incident – it may even strengthen its reputation.



Avoid Costly Penalties and Fines



Fines are assessed on the acquiring bank under the PCI DSS, typically passed to the organization.



Unlike the GDPR (General Data Protection Regulation), PCI DSS fines compound every month until the organization achieves compliance. As a result, they might quickly add up or push the organization to hurry into fulfilling its requirements.



It will be a costly procedure in either case, and it will not be the only one. Because the standards of the PCI DSS and the GDPR are similar, you may discover that non-compliance with the former is also a non-compliance with the latter.



As our last point, PCI DSS compliance may indicate that your security processes follow worldwide standards.



The requirements of the Standard were developed by five of the world's largest payment card companies, and by complying, you associate yourself with other trustworthy, multinational shops.



Conclusion



One of the difficulties with PCI compliance is the misconception that it is solely an IT issue. Because network security is a fundamental component of observation, it falls under the purview of technology. However, attackers are more likely to access an agency's sensitive card data via non-technical techniques and humans. Employees who deal with card payment systems must be instructed on how their job responsibilities support PCI compliance.



Before the conclusion of the fiscal year, agencies should strengthen their PCI compliance. However, PCI compliance is not a one-and-done project. To remain compliant, organizations must follow all of the standards each year.

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