Targeted: Why the next 18 months will be hell for retailers
Think the recent data breaches at major retailers you’ve heard about in the news are isolated incidents? Think again.
These data breaches are just the beginning. At Kount, while tracking fraud in real-time around the globe, we are able to gain a unique insights into overarching fraud trends. One of the most consistent trends we have seen involves chip-and-PIN (or, EMV) technology. In the years prior to chip-and-PIN roll out, attacks resulting in data breaches spike considerably as fraudsters build their war chests while data is still easy to steal from brick and mortar retailers. In the years following chip-and-PIN adoption, fraudsters shift their attention online. The recent attacks show we’re in the midst of the storm before the calm for brick and mortar retailers.
So, what does this mean for retailers and consumers alike? The next 18 months are going to be data security hell. That is, until October 2015, when most US credit card companies will roll out chip-and-PIN technology. Some retailers are already recognizing this; earlier this week, Target said they are hoping to roll out their chip-and-PIN system by early 2015, more than 6 months ahead of schedule.
Of course, this also means that late next year, online retailers should have their defenses well in place to combat the onslaught of fraudsters focusing on them. eCommerce poses both advantages and threats to the online retailer. Never before have fraudsters been so flexible, they are able to exist only in virtualized servers with masked IP addresses and quickly create networks with tens of thousands of points to slide past dated systems of authentication. Fortunately, there are solutions like Kount that adapt real time to thwart their efforts and protect online retailers far better than brick and mortar retailers could ever protect themselves.
There is still time for online retailers to mount their defenses and ensure both their consumers and their own bottom line are sheltered against the coming storm.