Tokenizing payment information and sending the data to the cloud can solve many issues for companies that accept payments, as long as the companies trust the tokenization provider.
A seemingly foolproof method to secure credit card information, tokenization generates a random alphanumeric code unrelated to the credit card number it’s tied to for processing, making it more difficult for anyone intercepting the information to use it illegally.
Paymetric Inc., an Alpharetta, Ga.-based provider of payment integration and tokenization services, adds a feature dubbed Data Intercept, which sends the card data straight to the cloud instead of an in-house backend system, where the data would be exposed to a potentially security breach. In doing so, not only are the data secure, but the liability for Payment Card Industry Data Security Standard compliance shifts from the client to Paymetric, company CEO Asif Ramji tells PaymentsSource.
Paymetric clients pay a monthly fee based on transaction volume for basic Paymetric tokenization services; the Data Intercept service costs extra, Ramji says.
“Encryption makes you PCI compliant, but that doesn’t protect you,” he says. “If somebody comes in with an encryption key, all your data’s exposed.”
Paymetric uses a higher level of security with tokenization, “but because we deploy through the cloud, we take that data out of the client’s environment,” Ramji says.
As efficient and secure as such services may seem, it’s only as safe as its provider, Shirley Inscoe, a senior analyst at Aite Group, tells PaymentsSource.
“It sounds like a magical process, but like all processes there are weak points,” Inscoe says. “There’s not anything magical; there are no silver bullets.”
If the service is managed well, Inscoe sees the benefit for merchants being able to outsource the liability they have for PCI compliance. “Not having the liability of maintaining that customer data, the negative publicity and the cost of communicating with clients or potentially paying bank fines is a huge benefit for the merchant,” she says.
In May, Paymetric announced a partnership with mobile and wireless software firm Velocitor Solutions to enable service providers to tokenize payments accepted by mobile sales staff. Velocitor develops the application for the device used to accept payment, and Paymetric integrates with the app. The Service Master Co. is using the partnership with its Terminix brand, Ramji says.
The application and tokenization service can work with a website, a point-of-sale terminal or a mobile device, Ramji says.
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