Magazine article Independent Banker

Securing Payments

Magazine article Independent Banker

Securing Payments

Article excerpt

Safeguarding customers' financial information is central to maintaining essential public trust in the financial and payments systems. Nobody understands this more intrinsically than the nation's community banks. Security, along with trusted financial products and expertise, is a foundation of every community bank's franchise value. As dedicated financial guardians, you stand the watch for your customers every single day.

Today, community banks must defend against a staggering barrage of relentless, highly sophisticated cyberthreats. As card issuers and account providers, you know firsthand that the most successful attacks have occurred against the largest retailers. Those data breaches have resulted in record card reissue costs and other losses for community banks. The Target and Home Depot card data breaches alone have cost community banks at least $130 million to reissue customer credit and debit cards, in addition to direct fraud losses.

For years ICBA has been working to put consistently strong security standards, regulations and procedures in place across the entire payments system. In 2014, in response to massive retail breaches, ICBA released a set of core data security principles to help guide policymakers, the payment card networks, the largest banks, merchants and technology service providers through the next steps to modernize and strengthen, as well as equitably sustain, how data is protected throughout the payments system.

Three of those core principles stand out as particularly important in light of today's cybersecurity risks and challenges.

1 Costs of data breaches should be borne by the breached party. Any breached party should bear responsibility for the fraud and mitigation costs it causes-to itself and to others. Aligning incentives to maximize data security by all parties that process or store consumer data will make the payments system stronger over time. …

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