End-to-end Encryption And Tokenization

As more consumers and merchants become increasingly aware of credit card fraud and

its devastating consequences, there is a need for merchants, both small and large, to protect credit card data by complying with PCI security standards. Today's advanced payment processing technology allows merchants to provide a higher level of security, keeping data safe through all points of the transaction. As of July 1, 2010, ensuring that all methods of payment processing are PCI compliant is required in order to protect merchants and consumers alike. Below, learn about end-to-end encryption (E2EE) and tokenization.

What Is End-to-End Encryption?:

Encrypting credit card data involves coding credit card numbers and rendering them useless to thieves should the data be compromised. As thieves and hackers are beginning to focus more on stealing credit card information while it is in transit during the transaction process, E2EE protects credit card information by encrypting the data from the first card swipe and coded all the way to the payment processor. This is especially useful in retail environments, during which customers swipe their credit cards through terminals to make a payment. E2EE is a highly advanced form of credit card security, protecting transaction data from beginning to end.

What Is Tokenization?:

While E2EE protects credit card data in transit, tokenization keeps data safe during storage. Many companies store credit card data in order to provide services such as recurring billing. Storing credit card numbers can be dangerous, as thieves can hack into the system and steal information for fraudulent activity. Tokenization replaces credit card numbers with a code or "Token" that is useless to hackers. Credit card information is protected, and merchants reduce liability when the data is stored in a secure, PCI compliant server.

The Importance of PCI Compliance:

Some merchants may be hesitant to implement advanced methods of payment security such as E2EE and tokenization, simply because of the high upfront costs. However, they must keep in mind if credit card information is ever compromised, they will be held liable. This could mean significant fines and financial loss that has the potential to put them out of business. In addition, ensuring payment methods are PCI compliant has become a requirement in the payment industry. Utilizing secure, PCI compliant payment processes reduces the merchant's fraud risk and helps save them hundreds of thousands of dollars in PCI non-compliance fees. E2EE and tokenization are powerful tools that help protect customers and merchants and saves money in the long run.

by: Julie Henaghan

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