With data breaches and skimming incidents already garnering headlines in 2012, it’s perhaps no surprise that secure payments was a hot topic among attendees at the National Retail Federation’s 101st Annual Convention & EXPO this week. As a growing number of smartphone makers unveil NFC technology that transforms mobile devices into wallets – and more consumers replace their traditional wallets with those of the virtual variety – concerns over security threats are likely to grow.

The rapid development and deployment of mobile payment technologies has certainly been a source of concern for those of us in the secure payments field. According to the 2011 KPMG Mobile Payments Outlook, a survey of nearly 1,000 global executives in the financial services, technology, telecommunications and retail industries, 83 percent of the respondents believe the use of cell phones for financial transactions will be a mainstream practice within four years. And 46 percent claim mobile payments will be common in the next two years. Also of note, 58 percent said they already have a mobile payments strategy in place.

As a response to this growing trend, the PCI Security Standards Council recently expanded its PIN Transaction Security (PTS) program guidelines to include all payment card acceptance devices, including those optimized for mobile devices. Previously, the program only applied to devices that accepted a PIN. The updated requirements address secure card readers, further facilitating the use of open platforms, such as mobile phones, to accept payments. So now, merchants looking to use magnetic stripe readers (MSRs) or plug-ins can ensure the devices have been tested and approved to encrypt data before it reaches the device. The new guidelines provide device manufacturers with a consistent set of data security and encryption standards. 

As many of you know, achieving and maintaining security is vital in the payments industry. The complexity of mobile payment technology has certainly introduced new risks and threats that may affect the security of cardholder data. That’s why it is more important now than ever for participants in the field to understand and support a uniform and widely understood compliance standard.