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With the second-largest internet user base, India currently has around 350 million customers who use digital payments across industries such as e-commerce, travel, hospitality, and entertainment. While users transact online, payment security remains an essential concern.
The security and privacy of the users’ information become crucial factors for businesses/merchants when choosing a payment gateway, as the RBI mandatorily requires their compliance with certain security measures.
What is a Payment Gateway?
A payment gateway allows you to accept payments through multiple payment methods, such as debit/credit cards, digital wallets, UPI, and more. Anyone who runs an online business (called a merchant) needs a payment gateway as a common platform to receive payments from multiple sources in their business account from their website.
Since the payment gateway is a medium between customers and merchants, it has to ensure secure payment processing for the customers to prevent frauds, establish customer trust and ensure regulatory compliances.
Secure Payment Gateway: Ensuring Safe Online Payments
The main reason why every merchant needs a compliant and secure payment gateway is that when frauds occur, merchants may get chargebacks, and they have to reimburse the customer whose account was used for fraudulent transactions.
Hence, data security is quite crucial for merchants, and the first step is to have a secure payment gateway.
Data Encryption
It is a process of encrypting the data entered using a public key. When the information is sent through the payment processor, the acquiring bank will decrypt the details using a private key (OTPs or other authorization methods).
Thus, it becomes quite difficult to steal payment information, and the chances of payment fraud reduce significantly.
PCI DSS Compliance
Compliance standards and rules related to card payments are provided in the Payment Card Industry Data Security Standard, PCI DSS. Thus, you, as a merchant, you and the payment gateway company, must adhere to these standards’ provisions if you accept card payments.
Some most common PCI DSS measures that the merchants and PGs must comply with include:
- Protection of the cardholder’s data
- Restriction on the usage of the vendor-supplied defaults for system passwords
- Monitoring all access to cardholder data and network resources
- Installation of firewall configuration
- Policy maintenance to address information security
- Updating anti-virus software or programs regularly
- Assigning a unique ID to each customer with computer access
- Encryption of the cardholder’s data transmission across public networks
- Access restriction to cardholder’s data by business
- Development of secure systems and applications
- Physical access restriction to cardholder’s data
- Testing security systems and processes regularly
Tokenization
As instructed by the RBI, as merchants you cannot store card details of a customer. Card tokenization converts customers’ sensitive card details into a security token using hashing, encryption, token, and security keys.
The RBI regulations allow PGs to create a unique token of your customer’s card details and use it for future payments so that customers’ details are secured and you, as a merchant, remain RBI regulations-compliant business.
Hence, you must ensure your payment gateway complies with the tokenization rules.
Secure Electronic Transaction (SET)
Developed in association with Mastercard and VISA, the secure electronic transaction is a digital protocol and framework for you to secure your customers’ credit card payment details. The framework requires payment gateways to hide users’ sensitive card payment details to prevent unauthorized access to them.
3D Secure 2.0 (3DS 2.0)
EMVCo (global technical body facilitating protocols for secure payments) issued authentication protocol 3D Secure 2.0 to provide customer authentication for online payments. The purpose of setting up a 3D Secure 2.0 protocol is to provide customers an extra layer of protection for online payment authentication.
When your customers enter card details and confirm payment, they receive an extra step where they enter 3D secure PINs or passwords to verify with their banks.
Secure Socket Layer (SSL)
Supported by all web browsers, SSL ensures secure data transmission between a web browser (of the customer) and the payment service provider. Your website should provide SSL security technology for every payment that transitions through it.
However, if your website does not have the SSL installed, the payment gateways will ensure to provide the SSL link to the browser so that the information is transferred securely.
Closing Thoughts
The safety and security of your customer’s financial information should be a top priority for every business. Thus, by choosing a payment gateway that adheres to stringent security measures, you not only protect your customers from the threat of fraud but also safeguard the reputation of your business. Select a payment gateway that provides robust security features and a compliant payment gateway system.
