10 Best Practices to Secure Online Payment Processing in 2024 (2024)

A rising trend in digital transactions fuels this growth, as fewer businesses rely on cash – only 60% still accept it. Moreover, the total transaction value is expected to grow at 10.73% CAGRby 2028, resulting in a total of USD $4620 bn.

This highlights the increasing demand for secure online payments, crucial not just for business productivity but for its very operation.

Moreover, with the rise of e-commerce and the shift to remote working, the need for robust online security measures is getting even more urgent. The security of online payment systems has a direct impact on consumer confidence, which in turn affects brand trust.

In this article, we’ll discover why Internet payment security is vital and explore how to get there.

Let’s get started!

What Is Secure Payment Processing?

Secure payment processing is a multi-stage approach to ensuring the confidentiality, integrity, and authenticity of financial transactions through state-of-the-art encryption, authentication, and fraud detection.

It’s crucial to know that the online payment security market is on the rise. In 2023, payment security market was worth $23.4 billion and is expected to grow by 15% from 2024 to 2032.

The very essence of payment processing security goes beyond simply transferring money online using secure payment forms or security protocols; it’s about fostering trust between buyers and sellers while eliminating security concerns. When shopping online using a checking account, people definitely want to know how to make secure payments online.

Key players such as payment service providers, credit card companies, secure credit card processors, and online gateways are involved in securing payment processing. This security depends on adherence to industry standards, such as PCI compliance (PCI DSS), and the implementation of anti-fraud measures.

However, a deeper understanding of the most secure payment methods requires a more in-depth examination, which we’ll discuss later.

But first, let’s take a look at why online payment security is so important.

What Is the Importance of Secure Online Payments?

Ensuring secure online payments means meeting the payment-related goals of everyone involved. But it’s not just about that. It’s also about earning customer trust – the cornerstone of sustainable business growth. You can streamline the process of online payment security with customized software developed by experienced fintech experts.

“Trust is key. Secure payment processing isn't just about protecting data, it's about showing your customers you've got their backs, keeping their money safe and transactions smooth.”

– Alex Kutsenko, Head of Marketing at DDI Development

Here’s why payment processing security is a must, not just a nice-to-have option.

1. You Need to Comply with PSD2 Rules

The payments industry has strict security standards to ensure secure payment online. These include the PSD2 Strong Customer Authentication (SCA) and PCI DSS standards. They ensure that online payments are secure by requiring multiple verification steps.

Failure to follow these rules can result in fines and legal issues for online businesses.

What is PSD2’s impact?

2. It’s Crucial to Protect Customer Data from Fraud

Online shopping may seem simple, but it’s actually problematic for everyone involved. Why is that? Well, think about it: when shoppers make a payment using their digital wallets, their payment information is sent out, making it vulnerable to unauthorized access.

This means that there is no guarantee that a secure connection will not be interrupted. Plus, sellers may not even get paid for the goods they sell. Fraudsters are always looking for weaknesses in transaction systems. That’s why it’s so important to secure digital wallets and credit card processing.

3. You Make Online Transactions Safer

Speaking of fraudsters, it’s important to note that knowing how to secure online payments can help combat identity theft and money laundering. With an SSL certificate and secure credit card processing supported by fraud detection tools and machine learning, you can effectively identify and stop fraudulent transactions.

4. Less Payment Disputes

What does this mean? Sometimes, customers dispute transactions and ask for refunds, causing chargebacks. This can be costly for you, even if the dispute is false. By knowing how to make secure payments online and ensure this security for your customers, you can lower those chargebacks.

Two other important reasons to consider:

1. Business reputation: Ensuring security builds your customers’ trust and improves your reputation. Conversely, failing to meet security standards can damage your reputation, leading to mistrust and lower profits.
2. Market expansion: Secure online payments open the door to a global customer base. Because different countries have their security regulations, implementing advanced payment security is critical to reaching audiences in other markets. Secure payment online paves the way for legitimate market expansion.

Best Practices to Secure Online Payment Processing

As a business owner, understanding payment security and choosing appropriate payment methods is critical. To help simplify the process, we’ve outlined 10 ways to ensure secure online payments and thus increase trust in your business.

1. SCA Enforcement

SCA (Strong Customer Authentication) is meant to reduce fraud and boost payment processing security. As a business owner, enforcing SCA means adding extra verification steps to online payments for increased security and fraud prevention.

To comply, use multi-factor authentication, known as two-factor authentication, choose secure payment gateways, as well as trustworthy payment service provider, educate customers, update payment systems, and keep an eye out for fraud.

Multi-factor authentication (or two factor authentication) requires two or more elements, such as a password, fingerprint, or mobile device, to ensure that the person making the transaction is legitimate. Implementing SCA Enforcement ensures that your online payment processing remains secure and compliant.

2. Fraud Monitoring

Fraud monitoring is the process of detecting and stopping online payment fraud against each customer’s bank account or digital wallets. To do this, merchants rely on secure online payment gateways that can quickly detect signs of fraud and stop fraudsters from illegally accessing money or data.

Fraud monitoring is critical for all businesses, especially in e-commerce. Besides, the e-commerce market is growing at about 10% per year and it’s expected to reach a revenue of $4997.00 billion by 2029. Secure, fraud-free Internet payments will play a significant role in driving this rapid growth.

Here are some steps you can take:

• Implement automated monitoring systems.
• Utilize an SSL certificate.
• Set transaction limits.
• Review high-risk transactions.
• Verify addresses and CVV codes.
• Keep an eye on trends in bank account fraud.

For added security, you may choose to manually review and approve transaction requests instead of relying solely on automated scanning.

3. AVS Integration

AVS Integration, or Address Verification Service Integration, is a crucial security measure.

It works by verifying the accuracy of customer billing addresses during online transactions. To maximize its effectiveness, integrate this security measure into your payment system. By confirming that the address provided matches the one associated with the customer’s credit card, you strengthen fraud protection and ensure secure online payments (ACH payments) for both your business and your customers.

4. Dynamic CVV

Another proven way to secure payment online is to use a dynamic CVV (Card Verification Value), an advanced security measure. Static CVV stays the same and is on the back of a bank card, whereas dynamic CVV changes with each transaction, making it tough for fraudsters to misuse funds.

By using dynamic CVV, you ensure that even if a fraudster somehow obtains a customer’s CVV from a previous transaction, it is useless for future transactions because it is constantly changing. This helps protect both your business and your customers’ sensitive financial information, reducing the risk of unauthorized transactions and potential fraud losses.

To effectively use dynamic CVV, integrate it into your debit card payments processing system or choose a secure online payment gateway that supports this feature.

5. Multi-Encryption Layers

As a business owner who handles online transactions, it’s important to keep your customers’ payment information secure. One powerful way to do this is through multi-level encryption.

Let’s break it down. Multi-layered encryption means using different levels of protection (like blocking sensitive information) to keep it safe from hackers.

Two important ways to lock up data are TLS (Transport Layer Security) and SSL (Secure Sockets Layer):

1. With an SSL certificate (what enables a website to utilize the HTTPS protocol) you can keep data secure, ensuring that it’s real and private.
2. TLS is an enhanced version of SSL that keeps data secure and hidden online, especially when you see “https://” in a website’s URL.

It’s easy for customers to tell if a company cares about security: just look at the website’s URL. If it starts with “https://” (SSL certificate is in place) or has a padlock icon, it’s secure. Remember: Without TLS encryption, any data sent online can be seen by anyone.

By using TLS/SSL certificate within your payment system, you create a secure path for data to travel, making it difficult for hackers to snoop.

6. Cross-Platform Audits

Cross-platform audits are like security checks for all the places your customers pay online. This includes your website, mobile apps, and any other digital platforms. The goal is to make sure all these places are safe from hackers and cyber threats.

This means looking at how data is stored, how passwords are protected, and finding any places where hackers could get in.

As a business owner, you can use cross-platform audits to make sure all of your systems are super secure. This means regularly checking and updating your website, mobile apps, and other platforms to meet the latest security standards.

With Cross-Platform Audits, you can:

• Keep your customers’ sensitive information, such as credit card data or debit card details, safe from hackers.
• Build trust with your customers because they know they’re safe with secure payment services.
• Comply with industry rules and regulations regarding the security of customer payment data. Cross-platform audits help you comply and avoid fines for non-compliance.

7. Biometric Authentication

Let’s start with what biometrics are. Biometrics are unique physical or behavioral characteristics of a person, such as fingerprints or how they type, which can identify them securely. That’s why biometrics are one of the safest ways to confirm someone’s identity in online payments and ACH payments (Automated Clearing House) as well.

There are two types of biometrics:

1. Physical biometrics, such as fingerprints, facial or voice recognition, or iris scanning.
2. Behavioral biometrics monitor how users interact with devices for authentication, such as how fast they type or how they hold their device.

Biometrics are essential for Strong Customer Authentication (SCA) as users must confirm their identity by providing biometric data, ensuring it’s really them.

3D Secure 2, an authentication method, now includes biometric authentication as a standard way to verify cardholders. This update is beneficial to all parties involved in the process:

• Biometrics are highly secure, keeping fraud and unauthorized access out of your payment system.
• Customers love the ease of biometric authentication, leading to faster transactions and happier customers.
• Biometric authentication makes it much harder for cybercriminals to pretend to be users, reducing fraud risk.
• Prioritizing security with biometric authentication shows you care about cardholder data safety.

8. Payment Containerization

Let’s talk about payment containerization, a critical secure credit card processing strategy that keeps transactions secure. It works by isolating sensitive customer payment data, such as credit card details or debit card numbers, in a secure “container” away from the rest of the system. This helps minimize the risk of unauthorized access to the financial data. Among the common secure online payment methods is tokenization, which replaces payment data with unique tokens that are meaningless to potential attackers if intercepted.

Payment containerization provides several benefits to organizations as it:

• Helps meet PCI compliance (PCI DSS).
• Saves time and resources by focusing compliance efforts on a smaller, isolated area.
• Boosts customer confidence by ensuring a secure payment environment with no risk of data breaches.

For successful implementation, businesses need to integrate with a secure online payment gateway or processor that supports payment containerization technology. It’s crucial to choose a payment solution with strong security features such as tokenization and encryption to effectively protect the data of your customers.

How does payment tokenization work?

9. Blockchain Transparency

Let’s break down what small business owners need to be aware of about the transparency delivered by blockchain technology.

Blockchain is one of the secure online payment methods of recording transactions in a decentralized way, using a network of computers to create blocks linked and secured with cryptography. This means once a block is added to the blockchain, it can’t be changed without the network’s agreement. Blockchains can be public or private.

One key aspect of blockchain is its ability to provide a secure payment method. Because transactions are recorded across a decentralized network, it’s hard for hackers to tamper with or fake data. Simply put, once data is on the blockchain, it’s there to stay.

Blockchain also offers transparency and accountability by:

• Making it easy to spot fraudulent activities.
• Allowing each user to see and track the entire transaction history, including details, time, and parties involved.

Additionally, blockchain:

• Helps with smart contracts, automating transactions, and reducing human error.
• Uses consensus mechanisms (proof of work (PoW) or proof of stake (PoS)) to verify transactions, ensuring only valid ones are accepted, boosting security, and reducing fraud risk.

As blockchain technology advances, it’s expected to facilitate more secure operations when it comes to transferring money. However, organizations should also consider the privacy concerns associated with blockchain transparency to avoid data breaches.

10. Employee Training

Internet payments safety threats can come from many places: strange emails with links, accidental data breach, phone messages, messengers, or even phone calls. Your employees must be trained to effectively handle such suspicious information, , including identifying and safely managing invoice-related emails. Educate employees to identify and safely handle suspicious emails or phone calls to protect your company, as well as your customers personal information.

Also, continue to remind them to:

• Avoid disclosing confidential data.
• Be cautious when dealing with messages from unauthorized sources and use a secure network only.
• Verify your company PCI compliance (PCI DSS) and adherence to other essential regulations.
• Maintain information hygiene by logging out of accounts promptly, not leaving workstations and storage devices unattended, and turning off devices that may expose confidential data.

Conclusion

In this article, we’ve discussed the most important secure online payment methods. Now that you realize how important it is to ensure safety when making online purchases and how to prevent potential problems, you are less likely to make mistakes in this matter.

To get started, decide on steps you can take immediately and gradually increase your security measures to provide your customers with truly secure transactions.