Just as the 2013 holiday shopping season was getting into full swing, the news media was abuzz with word that the credit card data belonging to tens of millions of Target customers had been stolen. Panic ensued. Discussions about enhancing credit card security are now the hot topic for merchants, processing companies and the consumers they served. Talk centered around what had gone wrong and how to prevent similar lapses from happening in years to come. Going forward, there are three major steps that can be taken to avoid future anxiety and expense.
- Better Data EncryptionThe primary action involves a change in the way American credit card issuers, merchants and banks do business. Instead of giving consumers cards with data stored in the magnetic strip on the back, it’s time to switch to the type of cards that have been used in Europe for years now. Known as smart cards, they keep a consumer’s data in encrypted form on a built-in microprocessor. The user has only to enter a PIN, after which the entire transaction is hidden from all parties, virtually eliminating the chances of eavesdropping and identity theft. Once this technology become standard in the U.S., consumers will be able to store multiple types of data and customer loyalty information on a single card.
- Protect Your BusinessIf you own a business, be hyper-aware. Keep all software updated; make sure you understand how to use it and get help if you don’t. Limit access to sensitive customer information to only those who absolutely must see it. If this is a particular concern for you, invest in software that monitors outbound communications from your employees. Whenever possible, also limit the use of private mobile phones, which are more prone to hacking than are business networks.
- Tips For ConsumersAs a consumer, there are some basic measures you can take even if you’re still using an old-fashioned magnetic strip card. Sign the back. Doing so could reduce your liability in the event of fraud. Invest in a paper shredder to dispose of billing statements and any other paperwork that holds your credit card number. If possible, avoid making any online purchases on a public Wi-Fi network. When shopping online, be sure that the web address begins with “https//”, not “http//.” The former is much more secure.
The good news is if you were one of the 40,000,000 Target shoppers affected by the breach, the most injurious effect you will probably feel is the inconvenience of ordering new cards. However, this incident serves as a loud wake-up call to everyone. The more we all work to enhance the encryption of our data and the measures we take to protect it, the less likely we will be to be victimized in the future.