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What Universities Can Teach Retailers About PCI
It takes a team. PCI compliance affects all parts of the enterprise, so universities assemble a dedicated, multidisciplinary team to address compliance. I don’t see this response very often from other merchants. A good team might include a core group featuring representatives from the finance, networking, security and internal audit departments. Each has a role to play. Other departments that will likely get involved at some point are legal, purchasing, human resources and training. Unfortunately, too often retailers treat PCI as exclusively an IT issue (see below).
PCI is a business issue. In my experience, most retailers and other merchants assign PCI compliance to the IT department. But for all the firewalls, encryption, log management and technical prescriptions in PCI, it really is a business issue: There is financial risk (losses, fines, lawsuits) and brand risk (reputation with customers and suppliers); it is the business side that controls the data; and it is the business side that has to budget for achieving and maintaining compliance.
My experience (confirmed by research from the Treasury Institute for Higher Education) indicates that the finance department is primarily responsible PCI compliance at roughly two-thirds of universities.
No business process is sacred. If there is a single lesson anyone involved in PCI has learned, it is to limit your PCI scope. If you think that as a retailer you can’t live without keeping PAN data, try talking to a university cashiering, alumni or athletics department. Initially, the staff in these departments feels as if they need the PAN for things like chargebacks, recurring payments and “customer service.” That is not the case. And when you compare the cost of becoming PCI compliant with and without storing cardholder data, the incentive to reduce or eliminate cardholder data is clear.
Remember “PCI Requirement 0.” Also, consider emerging technologies like tokenization and point-to-point encryption to reduce PCI scope.
Outsource intelligently. Every university asks itself what business it is in. The answer is always that it is in the education business, not the payment processing business. More retailers should ask themselves the same question.
There is a strong business case for outsourcing payment processing—especially for small and midsize merchants. Remember, though, outsourcing is not a panacea. Third-party processors need to be compliant (you need to get this in the contract), and purchased payment applications need to be PA-DSS validated and properly installed in a compliant environment.
Get Smart. Some of my happiest days come when I walk into a client and see training materials from a PCI workshop. Interestingly, I encounter this more in higher education than other industries. PCI training is important, and it can save a lot of wasted effort.
Communicate, train, empower. I believe people want to do the right thing, but they need to be trained. Most universities I know of require that all campus merchants take annual PCI training. If they miss the training, then they risk losing their ability to take payment cards. Some have the business unit manager sign a contract each year agreeing to comply with the institution’s payment card policies. These schools also have a merchant handbook and FAQ available online. I wish more of my retail and other clients with multiple locations had the same training and enforcement practices in place.
What do you think? I’d like to hear your thoughts. Either leave a comment or E-mail me at wconway@403labs.com.
Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code.
-Marc
