How safe are your payments?



From the first online payment made back in 1994 by the Internet Shopping Network and the first online financial institution, Stanford Federal Credit Union, customers have questioned the security of their card, their data and their money. The payment systems developed back in 1995 were working with cash alternatives like tokens or e-money and trying to figure out in a few steps how to transfer money quickly and most importantly, securely. According to financial lore, a pepperoni and mushroom pizza became one of the first online payments made, when Pizza Hut set up their new online delivery system. The major players we know today, Amazon, eBay et al, followed quickly and as the amount of money transacted, scaled to unimaginable size, security from scammers, hackers and pirates became the most important aspect of their growth strategies.

When it comes to payment security, the casual buyer and the corporate procurement professional should both be aware of security benchmarks to safeguard their transactions. These benchmarks are often clouded by acronyms such as AFSL, PCI DSS, HTTPS and SSL, shrouding them in mystery and adding a layer of uncertainty for anyone not au fait with the online financial accreditations. Australian Financial Services Licence (AFSL), Payment Card Industry Data Security Standards (PCI DSS), Hypertext Transfer Protocol Secure (HTTPS) and Secure Sockets Layer (SSL) are all protocols and security layers that authenticate, encrypt and decrypt data such as purchasing transactions sent over the internet. PCI DSS for instance imposes 12 general data security requirements, aimed at creating a secure infrastructure environment for merchants who want to achieve card payments compliance and also provide security comfort for their customers. These protocols have been set up independently to protect purchasers whenever they buy a product online and should be checked whenever you part with your hard earned money.

The 2020 McKinsey Global Payments Report indicated COVID will lead to a further decline in cash usage adding more pressure for online to be the safest platform for monetary transactions. So aside from benchmark security protocols such as above, there are other considerations to further protect your online purchasing transactions.

Credit cards have become the standard payment method for consumers and businesses alike because of all the added security layers and compliance around the use of the cards and as such should be a first consideration when making payments online. Another layer of security that most people are aware of, are e-wallets, such as PayPal, GooglePay and ApplePay, which act as middlemen who don’t share the user’s payment data. This means they don’t distribute the purchaser’s card information, instead using account information involving the exchange of unique random codes to enable the transaction to occur. Add two factor authentication or personal verification systems and you have done all you can to protect yourself and your money.