November 29, 2023
Only 43% of American businesses are PCI compliant. Why do millions of merchants pay PCI non-compliance fees and how can you ensure your business remains compliant in 2024?
Telecommunications giant Verizon recently released its annual Payment Security Report. In 2023, Verizon estimates that only 43% of American merchants are PCI compliant. This means that millions of businesses are incurring monthly PCI non-compliance fees and are at risk of major penalties (as much as $5,000 – $100,000 in monthly penalties) from credit card companies.
How can this be? Why are so many merchants throwing away money every month?
Understanding PCI Compliance
Perhaps the primary reason merchants incur PCI non-compliance penalties is a broad lack of understanding of how PCI compliance works. So what, exactly, is PCI compliance?
Payment Card Industry (PCI) compliance is required by credit card companies to help ensure the security of credit card transactions. PCI compliance refers to the technical and operational standards that every merchant must follow to secure and protect credit card data provided by cardholders and transmitted through card payment processing transactions.
What are PCI Compliance Requirements in 2024?
Merchants that implement protocols to follow Payment Card Industry Data Security Standards (PCI DSS) requirements are considered to be PCI compliant. The PCI Security Standards Council is responsible for developing 12 key requirements, 78 base requirements, and over 400 test procedures to ensure organizations are PCI DSS compliant. For many merchants, maintaining compliance with these numerous standards can feel overwhelming. There’s also an unfortunate reality that many Payments Services Providers (PSPs) are de-incentivized to help their merchant partners maintain PCI compliance since they can turn non-compliance into a profit-generating fee machine.
But there’s hope. Maintaining PCI compliance may actually be easier than you think. Partnering with a reputable Payments Services Provider can help merchants quickly obtain and maintain PCI compliance with minimal effort.
How to Obtain PCI Compliance in 2024
In order to conform with PCI guidelines, several protocols should be implemented which are considered security best practices. These 12 major steps are as follows:
- Implement firewalls to protect data
- Appropriate password protection (such as 2FA)
- Protect cardholder data
- Encryption of transmitted cardholder data
- Utilize antivirus and anti-malware software
- Update software and maintain security systems on a regular basis
- Restrict access to cardholder data
- Unique IDs assigned to those with access to data
- Restrict physical access to data storage
- Create and monitor access logs
- Test security systems on a regular basis
- Create a policy that is documented and that can be followed
Additional information on implementing PCI DSS standards can be obtained from the PCI Security Standards Council.
How do merchants know if they are PCI compliant? Here are 3 easy steps to avoid PCI non-compliance fees.
1. Review your merchant processing statements regularly. The #1 reason merchants incur PCI non-compliance fees is simply because they are unaware it’s even happening. Review your statements every month or Get A Free Statement Analysis from a payments expert.
2. Ask your provider about their PCI compliance policy and what services they give to help merchants remain compliant. Surprisingly, many providers avoid assisting merchants with PCI compliance so they can make a profit on non-compliance fees.
3. Make sure your payments technology is compliant. There are 12 core PCI compliance rules. Make sure you know the regulations and whether or not your transaction workflow is compliant. Not sure? Ask an expert.