Report: With Data Breaches on Rise, Issuers Should Up Protections (Aug. 26, 2014)
As payment card data security breaches become more common, financial institutions must step up to protect customer data, a new report says. Opportunity Knocks, a white paper from payments provider TSYS Inc., examines consumers’ growing concern about data security and suggests strategies for card issuers to mitigate the risk of a breach.
Payment card data are an increasingly attractive target for criminals, who can use the data to access money and personal identity information, including home addresses and Social Security numbers, which then can be used to commit other crimes. A report by Verizon found that data breaches were up 120 percent between 2012 and 2013. The cost of those breaches also is rising, with the average breach in the U.S. costing a company $5.85 million in 2014, up 9 percent over the previous year, according to a Ponemon Institute study. Costs associated with breaches include reimbursement of lost funds, help desk activities, remediation, legal expenditures, product discounts, identity protection services and regulatory intervention.
To protect against costly breaches, the TSYS report suggests financial institutions implement strategies, including involving cardholders via real-time access to spending and account information and spending alerts, as well as offering the ability to “lock” and “unlock” a card before each purchase. Government collaboration and further development of a more secure payments ecosystem also are vital, TSYS said. But while the spread of security technologies, such as EMV and tokenization, will help reduce risk, none is a “silver bullet,” the report cautioned.
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