In response to pressure from the National Retail Federation, Visa has agreed to reduce the amount of personal data they store in merchant systems. Retailers typically store credit card information in their systems to avoid having to repeat the process of inputting data every time they complete a transaction. Many corporations, however, have been victims of security breaches in which customer information was stolen. Credit card numbers can be used to access personal data and eventually lead to identity theft.
"By reducing the amount of vulnerable data in merchant systems that must be protected from compromise, merchants can see greater security as well as more streamlined compliance needs," said Eduardo Perez, who heads Visa's Global Payment System Security.
According to Perez, the latest objective of the company will be to expand security measures that are already intact. BusinessWeek notes that Visa will be encouraging more banks and merchants to disguise consumer security numbers and passwords when they're used in public. They'll also try to optimize their tokenization methods, which substitute proxy numbers for priority account numbers (PANs). PAN data is often used to resolve disputes and for other purposes.
BusinessWeek says that in the coming months, Visa will look to their shareholders for feedback on their security efforts. The company will be relying heavily on banks to follow through on their new measures and keep consumer data from falling directly into the hands of merchants.
While retailers typically try to implement best practices to secure personal data, no one can prepare for the unexpected. As technology continues to evolve, people are finding easier ways to hack into even the toughest security systems. The risk of identity theft runs high once personal information has fallen into the wrong hands. According to SpamLaws.com, approximately 10 million Americans are victims of identity theft every year, and less than half of all victims realize the theft has occurred within the first three months. For this reason, it's more important than ever to use caution when swiping a credit card.
Credit card fraud can result in long-term credit score damage. After stealing your personal data, a thief can go on a reckless spending spree and do severe damage to your credit card or bank account. It can take years to rebuild your credit history after an identity theft incident, and you may have difficulty obtaining loans, lines of credit, and even employment or a rented residence once your credit score has been tarnished. Reviewing your credit card statements thoroughly and regularly monitoring your credit reports can help you keep an eye out for possible signs of credit card fraud and identity theft.