How PCI compliance affects your bottom line?

Introduction

Payment Card Industry Data Security Standards (PCI DSS) is a non-legal regulatory compliance which acts as a protection for online transactions. It protects online payment platforms from fraud and data breaches. This is an independent entity administered by major credit firms which mean non-compliance is not necessarily illegal. Even then card fraud is a legal issue, and there are several intersecting issues that non-compliance raises. The consequences of non-compliance can be costly and embarrassing in case of a breach. There are several benefits that accrue from a firm which ensures compliance with PCI standards and stipulations.

1. Cuts Fraud Losses

Cutting card fraud boosts the balance sheet. In 2016 alone, research shows that the global card fraud losses topped at $24.17 billion with more than 46% of Americans having been card fraud victims in the last five years. Globally, Mexico is the capital of card fraud followed by Brazil and the US. These kinds of loses don’t just impact the clients they also impact a firm’s ability to serve its customers, and effect the needed services. Card fraud losses are virtually inestimable given not only the loss of cash but also customers and time. In recent years, these losses have led to closure or downsizing of some firms due to loss of business.

2. Boosts Business Trust

Brand management and consumer conference are some of the obvious benefits of PCI compliance. People will flock to a site which has a reputation for reliable and robust card safety. This translates to greater publicity and a sense of security which increases your ability to sell through your site or online store. Conversely, a site with erratic card security and a known history of PCI non-compliance will invite mistrust and push away risk averse online shoppers. Given the increasing levels of online sales, this could translate to huge loss in missed sales.

3. Minimizes Fines and Compensations

PCI Non-compliant merchants can, in some cases, be liable for card fraud and be required to undergo costly audits from card providers like Amex, and Visa. By relying on PCI systems, you can eliminate the risk of costly fines that can be as high as $500,000 or the minor fines and penalties ranging in the tens of thousands per breach. You will also save your firm from incurring expensive liabilities in the form of compensation to your clients. Lots of companies have been known to go into loss-making territory due to the heavy fines and settlements paid out to customers due to card fraud.

4. Increases Card Options

There are financial institutions that only do business with platforms that have effected PCI card security features. Such firms rely on the protection offered by PCI secured transactions. This means that if you are PCI compliant, you’ll automatically increase the range of cards you have available on your site and increase the number and variety of transactions available. Depending on the distribution of the card system this could give your firms access to regions and markets where unsecured sites cannot offer certain card transactions. This, in turn, gives you a market edge ahead of your competitors.

5. Minimizes the Need for Costly Audit

A data breach will automatically necessitate a card audit from the giant card firms like Visa, Amex, MasterCard, Express, and Diners Club. The average cost of data breach per card is about $202. When you multiply these over hundreds of thousands of customers accounts, then you are dealing with a very costly mistake. PCI compliant firms can save their balance sheets from these kinds of unnecessary costs. For example, the cost of the breach at Target is already estimated at $162 million.

6. Increased Conversion Rates

Research has shown that having PCI compliance logos on your site increases sales volume which in turn boosts your bottom-line. In one study the sales increased by over 42% when the firm displayed PCI compliance graphics and logos on their checkout pages. There’s no doubt that a company with SSL features and PCI compliance tend to inspire greater consumer confidence which in turn fuels increased and more frequent purchases. Some firms have claimed that PCI compliance fueled an 11% increase in their conversation rate and 23% increase in the value of transactions per person.

7. Protects Proprietary Data

All firms that conduct online transactions oversee a massive trove of client data including individual accounts, their purchase history, frequency, personal identities, and nature of transactions. PCI helps you protect this data alongside any data that you have in your systems. The proprietary data could also include your software platforms and how they process card transactions. That’s why any firm that handle people’s financial records and transactions cannot afford to work without a PCI compliance. Your proprietary data is such a central part of the company’s intellectual and transactional capital.

8. Saves You Forensic Investigation Cost

Besides the audit by the large card companies, PCI saves you from having to incur expensive forensic audit costs. These costs could range from $10,000- to $100,000. With the increasing sophistication of card fraud, the charges might also go even higher and eat into your profits. This is a cost that most firms, especially SMEs cannot afford to incur. So, over time PCI compliance saves you from data breaches they help you save up to $100,000 that could potentially be incurred to pay forensic investigators. Besides the $202 cost of card audit, you will have saved your firm from the forensic audit cost which averages about $50 per card.

Conclusion

At the end of the day, compliance is a personal choice with far reaching implications which could severely impact your business. The world of card safety continues to evolve with newer threats popping up every day especially in emerging economies. As more people move towards online stores and e-commerce, the need for PCI compliance will only increase. Firms that take their compliance seriously will continue to have the edge over those that downplay the security of their clients.