Even though we live in an age of ACH, credit cards, and other forms of payment processing, we should never, ever forget that security is still an issue. In the old days, most business people only had to worry about the security of their own physical store, and how accessible a cash register or vault was to potential thieves.
These days, when financial transactions often exist only as digital information, you’d think that the days of worrying are over. After all, a thief can’t break directly into your bank account, or that of a credit card company in order to steal the funds that are there, so what’s to worry about?
The sad fact of the matter is that while the danger of cash theft has been greatly reduced in the 21st century, that risk has now transferred over to your customers in the form of identity theft. Your concern is not that a hacker can break into your database and steal your money. Instead, the threat has transferred over to your customers.
Depending on the type of data you store about your customers, whether it is names and e-mail addresses to keep them informed about certain promotions or loyalty rewards, or the actual credit card numbers that they used in order to make their purchases, this data is now vulnerable to being stolen by unethical hackers.
When they take this information, it doesn’t necessarily present an immediate financial threat to you, but it does mean that sometimes customers can have confidential information, like their credit card numbers, taken and used by others in order to make unauthorized purchases.
In April of 2011, for example, electronics giant Sony had their database penetrated by hackers. This put the credit card details of up to 77 million users at risk. While this clearly didn’t impact Sony’s own finances, it hurt their reputation and did ultimately cause them to lose business as customers—with good reason—lost confidence in their ability to purchase products from Sony digitally.
The data breach allowed hackers to prank users, as, for example, 13000 users found their details leaked to the public as part of a prank and a demonstration that the data breach was legitimate. On the other far more harmful side of things, some Sony customers found their accounts had been seized from their control, with their passwords being changed by outside users, and purchases being made on their credit cards without their approval.
So even if your odds of being robbed are smaller in the digital age, you need to protect your data, or your customers could end up paying for your neglect.
Posted in Payment Processing on Jan 31, 2017