Home » Weighing in on Payment Industry Compliance in 2023 – Priorities and Best Practices

Weighing in on Payment Industry Compliance in 2023 - Priorities and Best Practices

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Sachin Sawant

VP - Compliance & Testing

The payment industry is highly regulated and compliance requirements are constantly evolving to keep pace with new technologies, changing consumer behavior and shifting regulatory priorities.

As we navigate this increasingly dynamic landscape in 2023, expect stronger regulations around digital payments aimed at enhancing security, fraud prevention and consumer protection. With regulators likely to introduce new rules, we also expect an uptick in investments on new technologies and processes by payment providers, to comply with these regulations.

Cross-border payments in recent years is a growing segment of the payment industry, but they are subject to complex regulations and compliance requirements. Compliance in cross-border payments involves ensuring that transactions comply with local and international regulations and laws, such as anti-money laundering (AML) and counter-terrorism financing (CTF) regulations. Regulators may introduce new rules to ensure that cross-border payments are secure, transparent and compliant with local laws and regulations. Further expect stricter KYC (know your customer) and due diligence requirements for payment providers.

We also expect greater emphasis by regulators on data protection. This will require payment providers to implement stronger data protection measures, such as encryption, access controls and regular vulnerability assessments.

Finally, compliance risk associated with third-party service providers will continue to pose a significant concern for financial institutions. Payment providers often rely on third-party vendors for services such as processing, fraud detection and customer support. Regulators may hold payment providers responsible for the actions of these vendors, which could require payment providers to conduct a more thorough due diligence of third-party providers to include contractual provisions, ongoing monitoring, incident management as relates to third-party service providers and exit strategies.

Keeping up with evolving compliance mandates requires payment providers to have the ability to control their data through a single pane of glass view across the organization. The aforementioned best practices can help to achieve this.

Define the scope: Start by identifying the data sources and systems that need to be included in the single pane of glass view. This could include data warehouses, data lakes, CRM systems, marketing automation platforms and other data sources.
Choose a data governance platform: Select a data governance platform that can integrate with all the data sources and provide a unified view. Look for a platform that can collect metadata and lineage information to provide complete visibility into the data.
Implement data classification: Implement data classification to identify sensitive data and tag it accordingly. This will help to apply the necessary security controls and ensure that data is handled appropriately.
Monitor data access: Set up monitoring tools that can track who is accessing data and how it is being used. This will help to detect any unauthorized access or activity and take action to prevent data breaches.
Automate compliance reporting: Use data governance platform to automate compliance reporting. This will help to generate reports on demand to demonstrate compliance with regulatory requirements.

With the threat of risks looming, regulators are expected to respond adequately with stricter measures and requirements. This will also call all payment providers to step up their game to stay compliant and create a more secure experience for customers.

Weighing in on Payment Industry Compliance in 2023 – Priorities and Best Practices

April 23, 2023

Introduction

In an increasingly data-driven world, organizations must harness the power of their data while maintaining robust information security. Data discovery, a crucial aspect of data management, can help organizations uncover valuable insights while simultaneously ensuring data protection and compliance. This blog post will discuss why organizations should consider data discovery from an information security perspective and provide a comprehensive approach to successfully implement it.

Data Discovery as a key tool for Information Security

Data discovery is a critical component of an organization’s information security strategy. It involves the identification and classification of all data within an organization’s infrastructure, including sensitive data, and is essential for developing effective security controls. Without data discovery, an organization may not be aware of all the data it possesses, where it is located, or who has access to it, leaving them vulnerable to data breaches and other cyber threats. Data discovery enables an organization to gain greater visibility into its data, implement appropriate security measures, comply with data privacy regulations and maintain the trust of their customers. From an information security standpoint, there are several reasons why organizations should consider data discovery:

1. Identify sensitive data:

Data discovery allows organizations to locate and classify sensitive data, such as personally identifiable information (PII), intellectual property, or financial data. Understanding where sensitive data resides is essential for implementing appropriate security measures and complying with data protection regulations like GDPR and CCPA.

2. Enhance access control:

By understanding the nature and location of critical data, organizations can establish role-based access controls and implement the principle of least privilege. Data discovery helps ensure that only authorized personnel have access to sensitive information, reducing the risk of unauthorized access and data breaches.

3. Monitor and audit data usage:

Data discovery tools can help organizations monitor and audit data usage, ensuring compliance with regulatory requirements and internal policies. By tracking data access and usage patterns, organizations can identify anomalies, such as unauthorized access or data exfiltration, and take prompt action to prevent potential breaches.

4. Improve data governance

Implementing data discovery allows organizations to establish a strong data governance framework. This framework includes policies, procedures, and controls to manage data usage, ensure data quality, and maintain data security throughout its lifecycle. Besides, data discovery can help organizations streamline their data management processes by eliminating unnecessary data and reducing the risk of data duplication or inconsistency.

Data Discovery for a strategic approach to Information Security

1. Develop a clear data discovery strategy:

Before embarking on data discovery, organizations should develop a clear strategy that outlines the goals, scope, and objectives of the initiative. This strategy should prioritize data security and compliance, ensuring that data discovery efforts align with the organization’s overall information security program.

2. Choose the right tools:

Select data discovery tools that cater to your organization’s specific needs and are capable of addressing information security concerns. Look for tools with features such as data classification, data lineage, and access control capabilities to enhance your data security posture.

3. Create a cross-functional team:

Establish a cross-functional team with members from data management, information security, and relevant business units. This collaborative approach ensures that data discovery efforts take into account diverse perspectives and maintain a strong focus on information security.

4. Implement data classification and labeling:

Use data discovery tools to classify and label sensitive data according to predefined categories and risk levels. This information can then be used to implement appropriate security controls and data handling procedures.

5. Monitor and audit regularly:

Continuously monitor and audit data access, usage, and security controls to ensure ongoing compliance with regulatory requirements and internal policies. Regularly review and update your data discovery strategy to address evolving security threats and business needs.

Conclusion

Data discovery offers a wealth of benefits, from uncovering hidden insights to driving innovation. However, organizations must also prioritize information security in their data discovery efforts. By developing a clear strategy, choosing the right tools, and fostering collaboration, organizations can unlock the full potential of their data while maintaining a robust information security posture. Results from the data discovery process should help organizations address their information vulnerabilities with thorough details, customized reports, data categorization, and risk assessments that can be used to design improvements and remediation action plans.