Retailers Look To Rein In Payment Data Security Weaknesses

By Ian Goldman, CEO, Celerant Technology Corp.

More and more retailers look towards tokenization to secure payment data.

Payment security has emerged as a major concern for retailers in the wake of a recent string of high-profile data breaches and rightfully so, considering that the global economy bled an estimated $160 billion as the result of lost payment data.  In an attempt to fortify customers’ sensitive, personal information, a growing number of retailers have looked towards payment tokenization as the preferred method of protecting credit and debit card data.

Tokenization is the process of protecting sensitive credit or debit card information by breaking up a string of numbers into a string of arbitrary symbols.  With tokenization, credit card data is never stored on the merchant level point of sale system.  It also helps to maintain compliance with PCI requirements, lowers the costs associated with compliance audits and allows for returns and fulfillment to take place without handling payment data. 

Tokenization is widely used by retailers to secure personal payment data, but several factors have prevented many retailers from utilizing this form of protection.  Many retailers must work with specific processing companies because of restrictions imposed by their banks.  Since tokenization is relatively new and still evolving, not all credit/debit card processing companies support tokenization yet.  This would obviously prevent any retailer bound to one of these processing companies from utilizing tokenization, at no fault of their own.  Until most processing companies support tokenization, retailers should focus on the technological aspects they can control—their POS system.

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