In this age of almost daily cybercrime incidents and data breaches, companies across the United States and around the globe are continually searching for ways to keep from becoming a victim. Businesses are looking for best practices and processes to help protect their data and their customers’ valuable information. In the world of credit card processing, one way that companies can protect online data is by using two-factor authentication.
Two-factor authentication is also referred to as two-step verification and is defined as a “security process in which the user provides two different authentication factors to better protect both the user’s credentials and resources the user can access.” Two-factor authentication provides a higher level of assurance than the authentication methods that depend one factor of authentication.
The way it works is simple – two-factor authentication requires two separate means of authentication to confirm an activity. For example, chances are you are familiar with how an ATM operates. When you use an ATM to get money or make a deposit, that ATM also uses the two-factor authentication method. First – you must have the bank card and second – you also need a PIN number to be able to use the machine and retrieve money from your account.
Other examples are ones that most of us encounter on in our daily lives.
When you have an account online, you typically need an email and a password to access that account. But if you forget your password or need to change it, the process is a little more difficult. Typically, the process to reset the email requires that the site send you an email to validate the password change and for you to be able to access the online account.
When you use a credit card for an online or telephone purchase, you often have to provide the CVC or CVV code to complete a purchase when it comes to using your credit cards. This code is located on the front of the card. By requiring people to provide the CVC or CVV code, it adds a layer of security that the person has the credit card with them.
Cybercrime continues to grow every year. According to Jupiter Research, cybercrime will cost U.S. businesses more than $2 billion dollars in 2019 alone and that number is expected to rise by the end of 2020. Worldwide, that number will top $6 trillion in 2019. In fact, experts say hackers target a business every 14 seconds. The average cost to a company is $2.4 million. These statistics can be frightening to many companies who are concerned about protecting their company and their customers’ information.
These statistics are why there is an increasing need for two-party authentication. The main reason is that access to common items such as usernames, email addresses and even credit card numbers are easier to obtain than ever before. With two-factor authentication, the requirement to validate that a person is who they claim to be lessens the risk of theft to all parties involved.
Typically, most criminals who want to steal information actors do not have access to both means of credit card verification. While two factor authentication is not foolproof, it does provide an extra barrier to the criminal. Most cyber criminals are searching for the easiest target and will not try to determine the second factor and move on to a different victim.
For merchants, two-factor authentication provides two benefits. First, it provides a reduction in fraud, as the card holder must be who he or she says they are in order to complete the transaction. Second, two-factor authentication not only gives the consumer a confidence level that the company is taking their security seriously, it also reduces the chances of chargebacks from the consumer.
At Red Maple, we carefully track the trends in cyber security and cybercrime. We work with hundreds of retailers around the world so protecting our clients is a top priority. That is why we created StagedPay, which offers a breakthrough solution for retailers to fight online theft and fraud and offers unprecedented protection. StagedPay enhances two-factor authentication and takes it to the next level. Not only are two methods used to enter the credit card, but the card number is used as a third means of verification.
StagedPay is a hosted credit card solution that uses two-factor authentication to allow merchants to process secure payment transactions. StagedPay works like a combination lock by allowing merchants to accept and process credit cards using only part of the card number. It requires multiple keys to authenticate, verify, and open the purchasing vault. To unlock the vault and complete the purchase, the customer must enter the rest of the card numbers on a secure, StagedPay site via text, email or phone. The merchant is notified when the order is authorized and complete.
This two-step process means the merchant never collects the full credit card number, so it is not vulnerable in the event of a data breach. StagedPay also helps prevent criminals from using stolen credit card numbers. The customer must provide an email or phone number associated with the credit card to verify and complete the transaction. StagedPay also allows the credit card information to be tokenized and inserted into a company’s ERP system to be re-used securely for future transactions.
StagedPay Card Not Present and StagedPay eCommerce work with small, medium and large merchant payment systems already in place. The program also ensures businesses maintains PCI compliance. For medium and large businesses, StagedPay can eliminate SAQ audits and the cost of PCI compliance as it requires more information from the consumer than card verification data and address verification for authentication.
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