Where Does Your POS System Stand with PCI Compliance?

For retailers planning to modernize, today’s POS systems offer plenty of updated features and advantages such as support for omnichannel retail, greater alignment with customer habits, and a sharper competitive edge. Security, however, is not typically seen as a key selling point for a POS upgrade. The fact is that resolving the vulnerabilities in your hardware and software tools are typically viewed as side benefits.

But with the deadline for adopting the latest PCI security standards set for March 2025, your ability to safeguard your data from cyberattacks should be a primary focus. By applying the right approach to modernization, you can streamline your journey to a crucial security milestone. Your POS update can dramatically improve your company’s ability to secure compliance with the latest standards now — and in the future.

Your retail system is the engine of your business. Any POS modernization feels complex enough without incorporating the variable of PCI compliance. However, if you work with the right partner, you can use this opportunity to upgrade your security standards while the hood is up on your retail system.

PCI Compliance: An Often Overlooked Safeguard to Prevent Cyber Attacks

PCI security standards consist of over a dozen operational and technical requirements set by payment providers to protect customer data. To secure compliance, you have to assess your company’s IT infrastructure, including your credit card handling practices. This process enables you to identify risks in your sales processes and ensure your POS system handles sensitive information in accordance with the PCI Data Security Standard (DSS).

Companies are not legally required to conform with the security standards outlined in PCI version 4. Consequently, compliance rates have been falling for years.  The rate of organizations who were “fully compliant” dropped from 37% in 2016 to only 27% in 2020. And the retail and hospitality industries were among the least compliant industries.

In many cases, these decreased compliance rates stem from companies using outdated POS systems that are difficult to update. Modernization is the best way to ensure your business adopts the latest security standards. 

Why Retailers Can’t Afford to Ignore PCI Compliance

Compliance for the upcoming PCI version 4 may not be legally enforced. But the cost of enduring a cyberattack is too great to risk.

For retailers, missing PCI compliance is the equivalent of driving your car without insurance. As long as you never get into an accident, you’re saving money by missing the monthly expense of a premium. But if something unexpected happens while driving, you’re grateful for insurance. Similarly, your business will be fine not meeting compliance as long as you never have a data breach. However, you face steep consequences should you suffer a cyberattack.

In the event of a breach, your business will be subject to fines to payment providers like Visa and Mastercard. Plus, you’ll owe fines to payment processors and individual customers. These fines can be as much as $100,000 a month until the vulnerability is resolved, and the penalties could be $90 per customer. Home Depot paid roughly $200 million to credit card companies and banks after its breach in 2014. Amazon was charged $877 million in fines in 2021.

Depending on your contracts, you may be required to disclose whether your business is PCI compliant to any contract retailers. For example, if your business manages bookstores at universities, you will have to release your compliance status to those institutions.

Along with increasing your cyber insurance rates, a data breach also exposes you to risk of losing your coverage. Should your business then experience another breach, you’re then responsible for fines per compromised account. 

Reworking Your Architecture Simplifies Your Compliance Journey

Modernizing your retail system opens up new opportunities for your business and its customers.  Along with resolving gaps in the customer experience between online and in-person shopping, today’s tools enable you to automate processes, incorporate mobile checkout, and support new payment types. Better still, you can plug in new services and system updates much faster. And as you’ve probably guessed, These gains in flexibility also apply to securing PCI compliance.

Your legacy POS system is a monolithic architecture, which means it’s composed of thousands of business rules built up over decades into one application. A single change impacts every aspect of the system.

When you work with the right technology partner, you can separate a monolithic architecture into many simple applications used across your enterprise. Your team can access and update a standalone payment microservice rather than navigating the maze of your whole system to incorporate compliance changes.

The right POS architecture can reduce scope for PCI compliance by more than 90% by limiting the cost and time investments needed to assess your system. Decoupling payments from the rest of your POS system holds the key to maintaining security for your transaction data.

Identify a Path to PCI Readiness with a Compliance Assessment 

At Kitestring, we have decades of experience in modernizing legacy POS systems. We have the expertise to identify the security risks within your system and its supporting platforms that impact compliance.

As part of our retail systems consulting services, we can compare the current state of your environment against all PCI requirements. Our compliance assessment includes five steps:

1. Review current POS architecture and the state of your business.
2. Offer recommendations for improvements to resolve weak points.
3. Document PCI requirements currently in place.
4. Create policy statements and document controls indicating your software activity.
5. Consult on best-fit security monitoring tools as well as reporting and training providers.

With the requirements for PCI v4.0.1 set to take effect in less than a year, you need to make a plan to protect your business by securing compliance. If you haven’t started remediating your requirements, you’re already behind.

If a POS modernization is already on your radar, you should perform a gap assessment to determine where your business stands and where it needs to go. If this sounds like a service that will help keep your retail business on track for a more stable future, we should talk.