Evolution Through Disruption: Five Security Developments That Are Changing The Payments Security Standards Landscape

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The evolution of payment security standards is vital to India's journey towards a safe and secure future in fintech. The onset of the Liberalization Privatization Globalization(LPG) model has sparked a significant surge in technological innovation. This technological innovation is drastically altering Indian lifestyles, which is reflected in how payments are made for both business and leisure. An 88 percent increase in digital transaction volume across the country since 2018-19 highlights this significant shift in the payments ecosystem, signaling great prospects for business owners in all sectors. While the country's economy is set to benefit greatly from these factors, business leaders must ensure the necessary measures are taken to secure developing digital infrastructure, helping prevent thefts and breaches.

Moreover, the Indian fintech market is experiencing rapid growth,and the sector is expected to be worth $150 billion by 2025. However, different types of cyber-attacks continue to remain a key threat to this growth.Properly utilising the appropriate security standards can help businesses better protect cardholder payment data and their bottom line. In this article we outline five examples of cutting-edge technologies or security standards that are already transforming the future of digital payment security.

A shift towards mobile payments in contemporary times has led to more and more businesses accepting and processing payments via mobile phones

Mobile Payments on Commercial off-the-shelf Devices(MPoC)
A shift towards mobile payments in contemporary times has led to more and more businesses accepting and processing payments via mobile phones and other commercial off-the-shelf (COTS) devices. PCI MPoC security standard aims to establish a modular, objective-based security standard that will accommodate various payment acceptance channels and consumer verification techniques for COTS products. The goal is to provide a versatile mobile standard and program for payment solution development that supports both PIN entry and contact less payments via COTS-native interfaces.

Contactless Payments on Commercial off-the-shelf Devices(CPoC)
CPoCallows COTS devices with embedded NFC interfaces to read payment cards or other payment devices while a validated payment acceptance software application runs on the merchant COTS device to start a contactless transaction. Meanwhile, back-end systems, that is independent of the COTS device, support monitoring, integrity checks, and payment processing. In a CPoC Solution, software-based PIN input is not permitted. The PCI CPoC security standard helps ensure that these contactless transactions can be trusted by merchants and customers by providing security and test requirements for these payment solutions.

Point-to-point Encryption(P2PE)
P2PE is a technology standard that was developed to safeguard electronic financial transactions. By adhering to PCI P2PE Standards, developers for the electronic payments network can ensure that their designs are mutually interoperable and resistant to future hacker assaults. Transaction data is fully encrypted under these standards from the time the customer submits their data until it is delivered to the payment processor. When the payment processor receives the data, it decrypts it and either accepts or denies the transaction. The transaction data is not vulnerable to capture and misuse by unauthorized entities because it is fully encrypted throughout the procedure.

3D Secure(3DS)
A 3D security protocol adds an extra layer of payment security to an online transaction. To complete an online purchase, the cardholder must provide identification by inputting a unique password, an SMS code, or a temporary PIN. One significant advantage of 3D Secure is that it protects both consumers and merchants against payment fraud. Another advantage of 3D Secure for online merchants is the payment liability shift. An issuing bank becomes liable for fraudulent charge backs by completing an additional authentication step using 3D Secure. Even if the customer says they have an unlawful payment from you on their card, the card provider is usually in charge of administering the refunds.

Tokenization is the process of swapping out actual card data with a special alternate code called the 'token', which needs to be different for the card, the token requester (the company that accepts client requests for card tokenization and sends them to the card network to issue a corresponding token), and device. The digital token is a 16-digit card number that is made up of a string of randomly chosen, mostly alphanumeric, characters. Now, for any purchases done online or through mobile apps, merchants, payment aggregators, and payment gateways won't be able to maintain crucial customer credit and debit card information, including the three-digit CVV and expiration date.

As businesses continue to grow and flourish, so do their means of conducting business transactions. The industry's transition from hardwired devices to devices that are readily available at any location and at any time depends on this evolution in how payments are made and processed. Payment security is one of the most important considerations for any business. With India's payment ecosystem experiencing a sudden and recent boom, protection against fraud, and misuse of account and payment information from any form of malpractice is imperative.The goal of payment standards is to tackle the growing threat of cybercrime and help ensure a safe and secure payments ecosystem.

All five of these security developments are having a significant impact on businesses and individuals in protecting them against a growing number of cyber criminals who continue to operate across the country. The PCI Security Standards Council operates programs to train, test, and qualify organizations and individuals who assess and validate compliance, in order to help merchants successfully implement these security standards and solutions.