5 min read

What is PCI DSS? - Security Standards for Credit Card Data Storage

The Payment Card Industry Data Security Standard (PCI DSS) is a set of standards designed to ensure that merchants, banks, and vendors protect the confidential data of credit card users. The PCI DSS security standard covers several areas of secure network architecture, secure access control, vendor management, and other critical security controls. All organizations handling payment card data must comply with these standards or risk fines and business challenges from the consequences of a breach. With so much at stake for businesses and financial institutions, it’s important to understand what is PCI DSS so you can take advantage of the opportunities it presents while avoiding its potential risks. Let’s explore this article to find out more about PCI DSS compliance.

What is PCI DSS?

PCI DSS stands for the Payment Card Industry Data Security Standard. It is a set of security standards for protecting credit card data in any environment where it could be put at risk, including online and traditional POS environments. PCI DSS is implemented by payment card brands like Visa, Mastercard, and American Express, as well as the banking associations that issue debit and credit cards. The goal of PCI DSS is to reduce the risk of fraud by protecting the vast amounts of data associated with credit card transactions. The standard requires businesses that store, process, or transmit credit card data to protect the data against cyber criminals. It includes 12 security requirements that must be implemented in order to reduce the risk of credit card fraud. The PCI DSS standard has undergone several revisions to keep up with the growing sophistication of cyber criminals. Each revision has added new requirements to the standard. The most recent version of the standard is PCI DSS 3.2. This article focuses on this current version.

The History of PCI DSS

The earliest version of PCI DSS was published in March 2006 as version 1.0. This version was intended as a best practice guide, but it was also the first effort to bring some degree of standardization to the field of data security. It was followed by version 2.0 in February 2008 and version 3.0 in June 2010. The current version, PCI DSS 3.2, was published in February 2018. The history of PCI DSS is also the history of its effectiveness. Data breaches have been around for as long as computers have existed, but the frequency and sophistication of such breaches have grown dramatically in the past decade. PCI DSS has evolved as an attempt to keep up with these new challenges. The first version of PCI DSS was designed primarily to reduce the risk of unencrypted data being stolen from a computer. This has always been a primary concern, but it took on a new urgency in the 1990s when the internet began to proliferate.

Why Is PCI DSS important?

The main reason why PCI DSS is important is to prevent credit card fraud. Credit card fraud is the illegal practice of using other people’s credit card information to make purchases and gain access to the funds on their credit card. This is usually done by stealing or finding the credit card information and then using it to make fraudulent purchases. Credit card fraud can be done online or in person at a retail store. It is most often done online, especially through websites that sell goods or services. It is also done through telephone systems. Credit card fraud is a serious crime that has a huge impact on businesses that use payment card systems and their customers. Credit card fraud causes loss to businesses, customers, and payment card companies. In order to prevent this, businesses that handle payment card data must comply with the Payment Card Industry Data Security Standard. This data security standard was created to protect the confidential data of credit card users.

What are the requirements of PCI DSS?

The PCI DSS is a standardized approach to securing cardholder data. There are 12 requirements in the PCI DSS standard with varying degrees of importance:

 

- System Security Management: This requirement focuses on managing the system’s security. It requires organizations to implement a security management program with risk-based policies, procedures, and controls.

- Identify Acquisition Venues: This requirement focuses on the acquisition of equipment and data from third parties. It requires organizations to perform a thorough risk assessment of the third parties before acquiring any data or equipment from them.

- Identify External Access: This requirement focuses on governing external access to the network. It requires organizations to perform a thorough risk assessment of all external access to their network.

- Regularly Monitor Systems: This requirement focuses on monitoring the network for any unauthorized activity. It requires organizations to monitor their networks to identify any potential security breaches.

- Regularly Test Networks: This requirement focuses on testing all systems regularly to identify potential issues and security vulnerabilities. It requires organizations to test the security controls of their networks to identify potential issues.

- Maintain a Policy on Disabling Inactive Accounts: This requirement focuses on controlling inactive accounts. It requires organizations to establish a policy for disabling inactive accounts, such as those that are not used for a certain period of time.

- Maintain a Policy on Retiring Systems: This requirement focuses on retiring systems properly. It requires organizations to establish a policy for retiring systems. This helps ensure that systems and any data from those systems are properly destroyed.

- Maintain Regular Backup Operations: This requirement focuses on maintaining regular backup operations. It requires organizations to have a regular backup process, such as having backups created daily.

- Maintain a Policy on Encryption: This requirement focuses on encryption of data. It requires organizations to have a policy for encryption of data. This includes both data in transit, such as data being sent to other systems, and data at rest, such as data stored on a computer or network.

- Maintain a Policy on Disposing of Data: This requirement focuses on proper disposal of data. It requires organizations to have a policy for how they dispose of data, such as destroying data by shredding hard drives.

- Maintain Regularly Scheduled Security Awareness Training: This requirement focuses on security awareness training. It requires organizations to maintain a regular schedule for security awareness training, such as conducting training once per week.

Who must comply with PCI DSS?

All organizations that store, transmit, or process credit card data must comply with the Payment Card Industry Data Security Standard (PCI DSS). This includes both businesses and vendors that process credit card data on behalf of other organizations. Businesses in many different industries can be subject to PCI DSS compliance, including hospitality, retail, banking, travel and transportation, food and beverage, health and medical care, insurance, and more. As long as you handle confidential credit card data, you must protect that data according to PCI DSS. Most businesses that handle credit card data will have a payment card services provider (PCSP). The PCSP handles the compliance requirements for that organization. But organizations should still be aware of PCI DSS compliance requirements and make sure they receive regular security training.

What are the penalties for non-compliance with PCI DSS?

Fines for non-compliance with PCI DSS are significant. They are one of the main reasons why businesses want to comply with the PCI DSS security standard. The fines for non-compliance are tiered, depending on the severity of the violation. For minor violations, the fines range from $100 to $19,999. For moderate violations, fines range from $20,000 to $49,999. For serious violations, fines range from $50,000 to $99,999. For extreme violations, fines range from $100,000 to $499,999. For gross violations, fines range from $500,000 to $1 million.

What does being PCI DSS compliant mean?

Compliance with PCI DSS means that you have implemented the security controls required by the standard. It does not mean that you have not been breached or that your data is completely secure. It simply means that you have implemented the security controls described in the standard. Therefore, while compliance with PCI DSS is an important first step toward data security, it is not a guarantee that you will be secure. Compliance with PCI DSS is a process that you must continually assess and improve. You can never be complacent about compliance or you will quickly fall out of compliance with the PCI DSS security

 

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