Society of Payment Security Professionals - Payment Security Blog

PCI Adoption in Europe and Asia Pacific

Rob Newby blogs about the statistics and studies on the adoption of PCI compliance in Europe, based on the data points from a Register article with the same focus.  The article states:

European merchants are behind their US counterparts in getting up to speed with the Payment Card Industry’s Data Security Standard (PCI DSS), according to a survey by management tools firm NetIQ.

Rob points out that with a sample population of 65 data points:

… all I can conclude from this survey is that NetIQ customers are ignorant, which isn’t a great advert for them.

There’s a little bit of truth in both opinions (read the NetIQ comments on Rob’s blog.)  It is true that PCI adoption in Europe is slower than that of merchants in the USA, and Asia Pacific is even further, but there a very good reason for this.

You have to factor in that organizations such as APACS has been pushing Chip-PIN for many years now.  France implemented Chip-PIN for the past six years.  This is not to say that the risks are lower, but many different factors play a role.

European PCI DSS Adoption Factors

The first factor is that of education.  Whenever you talk with someone about PCI in Europe this is how the conversation goes:

“I’d like to talk with you about PCI DSS.”
“PCI DSS? What is that?”
“Well it has to do with credit card security…”
“Oh, I don’t need that, I have this Chip-PIN infrastructure.”

It’s hard to get merchants over the fact that they cannot mitigate all the risk of storing credit card data simply by rolling out Chip-PIN terminals.

The second factor affecting merchant compliance in Europe is that in countries such as Spain and Italy a merchant will not have just one or two acquirers but more like 10-12 acquiring banks.  Since each bank only does 1/10 or 1/12 of that merchant’s business it’s a hard business proposition for one of them to take the first step forward and require the merchant to validate their compliance.  The risk is high that a merchant may simply drop that acquirer from their transaction processing channel.

Asia-Pacific PCI DSS Adoption Factors

Within the Asia-Pacific (AP) region merchant adoption of PCI DSS has been slow due to the risk factors.  Each country is different, but as a region the amount of fraud happening “in-country” is rather low.  This means that credit cards compromised and used fraudulently within S. Korea is very low.  The fraud of note is that which is classified as “cross border” fraud.  This is where a credit card compromised within the USA is then used in Australia fraudulently.  Due to these fraud factors, and the historic emphasis on driving service provider compliance within the region, merchants are slower to the game.

That said, I was just in Australia and the number of QSA companies operating in the region is considerably higher both there and in Japan (two of the largest AP countries by transaction volume.)  This increase in auditors shows an increasing demand for compliance validation on behalf of merchants.  Articles that show the “slow” adoption are like trying to buy a car without looking under the hood.  You may look at an older Honda Civic and think you can beat it in a race, but not if it’s got a turbo-charged Acura engine under the hood.

I think the key to remember is that all merchants are at risk and that risk varies by industry, vertical, infrastructure, and so many other factors.  I like Rob’s reminder that:

I am prepared to admit that the spotlight will be on the Tier 1 merchants in the first instance. However, its a bit like relying on everyone else being fatter to avoid heart disease, i.e. stupid.