Visa Inc. (NYSE: V) launched a global effort to reduce unnecessary storage of sensitive card information in merchant payment systems. Understanding the significant commitment by merchants to secure the payment system and to protect sensitive cardholder information from criminals, Visa is clarifying existing operating regulations to ensure that acquirers and issuers allow merchants to present a truncated, disguised or masked card number on a transaction receipt for dispute resolution in place of the full 16-digit card number.

"Visa's priority is protecting cardholders and the integrity of the electronic payments system," said Eduardo Perez, Head of Global Payment System Security, Visa Inc. "By reducing the amount of vulnerable data in merchant systems that must be protected from compromise, merchants can see greater security as well as more streamlined compliance needs."

Visa and the National Retail Federation (NRF) agree that merchants should not be obligated by their acquiring banks to store card numbers for the purpose of satisfying card retrieval requests. While Visa does not require merchants to store full card numbers beyond settlement, NRF's comments indicated marketplace confusion about what information merchants are required to store for dispute resolution by issuers, acquirers or processors. To clarify, Visa operating regulations stipulate the following:

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Issuers must accept a disguised or suppressed card number on transaction receipts for dispute resolution.
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Merchants may keep truncated or disguised card numbers and reduce the amount of potential vulnerable data stored in their systems.

National Retail Federation senior vice president and chief information officer David Hogan welcomes Visa's effort. "We have long advocated that retailers should not be required to store their customers' full card numbers and instead rely on an alternative identification number to reference a transaction," he said. "NRF has been pleased to take a leadership role working with Visa in this effort to assist retailers in our mutual goal of securing customers' information while potentially reducing the scope of the PCI Data Security Standard. Merchants should be encouraged to minimize both the amount of card information they store and the duration they keep it. The bottom line is that they should not be penalized for not storing card information. This clarification from Visa is a promising step in that direction," said Hogan.

"Making data less vulnerable to card thieves by eliminating it wherever possible has been a major focus by Visa for several years now," Perez said. "Visa is committed to helping develop workable solutions that reduce the burden on merchants who must secure their payment systems from criminal threats. Working with the National Retail Federation has helped us identify an issue and address it effectively."

Card Number Truncation Best Practices

Additionally, Visa has developed global best practices for acquirers and merchants who choose not to store full card numbers to truncate, disguise or mask card information in cardholder and merchant receipts, reducing the amount of sensitive information in storage. The following are best practices for card number truncation:

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On the cardholder receipt, merchants should disguise or suppress all but the last four digits of the card number (####-####-####-1234) and suppress the full expiration date (currently required in the U.S.)
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On the merchants' copy of the receipt, merchants should disguise or suppress the card number so that a maximum of the first six and last four digits of the card number are displayed (1234-56##-####-1234) and suppress the full expiration date on the merchant copy of receipts.
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Acquirers should support merchants who choose not to store full card numbers by providing transaction data storage. Merchants may then retain only disguised or suppressed card numbers on the merchant copy of the receipts.
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Acquirers should evolve their systems to provide merchants with substitute transaction identifiers or tokens, in place of using full card numbers.
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Acquirers should disguise or suppress card numbers in any merchant communications, such as email, reports, statements, etc. The Payment Card Industry Data Security Standards (PCI DSS) already requires that card numbers transmitted over public networks must be rendered unreadable (e.g. by encryption, truncation or hashing).

Visa will work with key stakeholders to consider incorporating the best practices formally into Visa Operating Regulations and is soliciting industry feedback until August 31, 2010. The best practices are available at www.visa.com/cisp.

Visa previously established efforts to ensure that merchants do not store prohibited data elements which are specifically targeted by criminals, including card security codes and PIN data. In particular, Visa has required the largest Visa-accepting merchants to confirm that they do not store such prohibited data and thus far 96 percent of Level 1 and 2 merchants globally have done so. In addition, Visa has promoted the use of secure payment applications to ensure small and medium sized merchants do not store prohibited data.

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PULSE, one of the nation's leading debit/ATM networks, is bringing PIN based debit to online shopping with the introduction of PULSE(R) Internet PIN debit.

Financial institutions using PULSEInternet PIN Debit can deliver convenient PIN-based, online transaction verification to a growing number of consumers who purchase products from e-commerce merchants. The new payment solution, which uses Acculynk's PaySecure(R) Internet PIN debit software, reinforces the issuer and cardholder relationship by using a financial institution-branded graphical PIN pad.

According to a forecast from Javelin Strategy & Research, online retail transaction volume is expected to reach $268 billion by 2013. However, as many as 15 percent of debit cardholders have PIN-only debit cards, which previously could not be used for Internet purchases.

A separate Javelin study conducted last year found that 79 percent of consumers surveyed would feel more comfortable using debit cards online with a PIN than without it. PULSE network issuers can now address this need with Internet PIN debit transactions, giving cardholders the option to use their PIN debit cards for e-commerce in an easy and safe manner.

PULSE confirmed cardholders' acceptance of the technology in a 2009 pilot, which used PaySecure. In the pilot, 54 percent of debit cardholders paying for online purchases preferred to enter a PIN when presented with the choice of PIN or signature options to complete the transactions. Additionally, chargebacks were reduced 77 percent compared to signature debit transactions, and there were no instances of fraudulent transactions.

"Our successful pilot confirms that debit cardholders are comfortable entering a PIN when shopping online," said Judith McGuire, PULSE senior vice president of product management. "With PULSE Internet PIN debit, financial institutions can offer cardholders a secure, trusted and preferred payment option for online purchases. The product gives consumers with PIN-only debit cards a new payment choice, and should appeal to cardholders who already prefer to enter their PIN at brick-and-mortar retailers."

How PULSE Internet PIN Debit Works

When consumers check out in the usual manner from a merchant website using cards that participate in PULSE Internet PIN Debit, they are given the option of completing the transaction with a PIN. Consumers who select this option are prompted to enter their PIN to complete the transaction, using a graphical, scrambling PIN pad that can be customized with the card issuer's logo and debit card design. The cardholder clicks the mouse on a number and the PIN pad re-scrambles as each subsequent digit is selected. The PIN is not captured on the computer, nor is it transmitted over the Internet.

The solution makes a general phishing attack difficult because several unique attributes are displayed during the transaction, including merchant branding, financial institution identifiers and the VeriSign Secured(R) Seal. In addition, Acculynk's Internet PIN debit software service is integrated directly into the online checkout process, eliminating the need for cardholders to enroll or be redirected to another site to complete purchases.

A demonstration of PULSE Internet PIN Debit and more product information is available at www.pulsenetwork.com/ipd.

About PULSE

PULSE, a Discover Financial Services (NYSE: DFS) company, is a leading ATM/debit network, serving more than 4,400 banks, credit unions and savings institutions across the United States. The network links cardholders with ATMs and POS terminals at locations nationwide. Through its global ATM network, PULSE provides worldwide cash access for Diners Club and Discover cardholders through hundreds of thousands of ATM locations. The company is also a source of electronic payments research and is committed to providing its participants with education on emerging products, services and trends in the payments industry. For more information, visit

Menexis (menexis.com) is a company that primarily provides ACH/check processing services. For clients who are interested, Menexis can also provide a merchant account through First Data.

According to the sources I could find, Menexis has been in business since 2004 and recently registered with the Better Business Bureau in 2007. I could not find any complaints about the company and, overall, seems to have a good reputation.

Menexis Business Address:
6400 Laurel Canyon Blvd.
North Hollywood, CA 91606

A majority of Americans report that quality customer service is more important to them in today's economic environment (61%) and will spend an average of 9% more when they believe a company provides excellent service. However, in a challenging economy where growth is harder to achieve, many businesses are missing out on this opportunity. Although only a little more than a third of Americans (37%) believe that companies have increased their focus on providing quality service:

-- 27% feel businesses have not changed their attitude toward customer service.

-- 28% say that companies are now paying less attention to good service.

These findings were released today in the American Express Global Customer Service Barometer, a survey conducted in the U.S. and eleven other countries exploring attitudes and preferences toward customer service.

"Customers want and expect superior service," said Jim Bush, Executive Vice President, World Service. "Especially in this tight economic environment, consumers are focused on getting good value for their money. Many consumers say companies haven't done enough to improve their approach to service in this economy, and yet it's clear they're willing to spend more with those that deliver excellent service -- suggesting substantial growth opportunities for businesses that get customer service right. It's important to see customer service as an investment, not a cost."

Almost All Agree Service is Important, but One in Five Feel They're Taken for Granted

Not surprisingly, nine in ten Americans (91%) consider the level of customer service important when deciding to do business with a company. But only one-quarter (24%) believe companies value their business and will go the extra mile to keep it. Most feel businesses can do more to retain their loyalty:

-- 48% feel companies are helpful but don't do anything extra to keep their business.

-- Worse, 21% believe that companies take their business for granted.

Good News Travels Fast -- Until You Go Online

Importantly, customers are spreading the word willingly and widely when they experience good service. In fact, contrary to conventional wisdom, customers are more inclined to talk about a positive experience than complain about a negative one. Three-quarters (75%) are very likely to speak positively about a company after a good service experience in contrast with 59% who are very likely to speak negatively about a company after poor service.

Good service experiences also carry more weight than bad ones when Americans make future spending decisions. Consumers are far more likely to give a company repeat business after a good service experience (81%) than they are to never do business with a company again after a poor experience (52%).

In fact, consumers say the three most influential factors when deciding which companies they do business with include personal experience (98%), a company's reputation or brand (92%), and recommendations from friends and family (88%).

Nearly half (48%) of consumers report always or often using an online posting or blog to get others' opinions about a company's customer service reputation. But when consumers go online they're looking for "watch outs," saying they put greater credence in negative reviews on blogs and social networking sites than on positive ones (57% and 48%, respectively).

"The Internet has made service quality more transparent than ever before," Mr. Bush said. "In the online space, positive recommendations are important, but people often give more weight to the negative. Because consumers can broadcast their views so widely online, each and every service interaction a company has with its customers becomes even more crucial. Developing relationships with customers, listening to them, anticipating their needs, and resolving any issues quickly and courteously can help make the difference."

Two Strikes and You're Out. Or Is It One?

A negative service experience is an important factor for most Americans: 81% have decided never to do business with a company again because of poor customer service in the past. When asked how many poor experiences they allow, half of all Americans (50%) reported it takes two poor service experiences before they stop doing business with a company.

Importantly, consumers are far more forgiving if a company has earned their trust over time. Almost nine-in-ten consumers (86%) report they're willing to give a company a second chance after a bad experience if they've historically experienced great customer service with that company.

But companies who get it wrong should realize it's at a cost.

-- Half of consumers (52%) expect something in return after a poor customer service experience, beyond resolving the problem.

-- Most consumers (70%) want an apology or some form of reimbursement.

Service Leaders Recognize the Value

Companies with reputations for great customer service take different approaches, however they share the common understanding that investing in service truly pays off.

"While customers appreciate the plush surroundings of our five-star hotels, we know that luxurious touches don't matter to guests unless the service surpasses the setting," said Simon Cooper, president, The Ritz-Carlton Hotel Company LLC. "Trends may change, but a focus on service excellence is timeless."

"What many people refer to as 'great service', we call hospitality," says Susan Reilly Salgado, managing director of Danny Meyer's learning business, Hospitality Quotient. "Service is all about the technical delivery of the product, while hospitality is about how guests feel during that transaction. Hospitality happens when guests believe you are on their side. For people to rave about their experience and become repeat customers, you need to have both - but what surprises customers and makes them feel genuinely cared for is the hospitality. And that's the reason people love to talk about those fantastic experiences -- because they surpass expectations."

"By focusing on our company culture, we've been fortunate to hire great people where providing great service is in their DNA. We always have been and continue to grow through word of mouth. If you treat the customer how they should be treated and form personal connections with them, they'll want to tell others about it," said Aaron Magness, senior director, brand marketing and business development, Zappos.com.

Service is Valued Everywhere, but Views Vary Globally

Similar to their U.S. counterparts, a majority of consumers in all but one country surveyed feel that customer service has become more important in the current economy:

India 82% Canada 58%
Germany 68% U.K. 58%
Japan 65% Italy 55%
Mexico 65% Australia 53%
U.S. 61% Spain 52%
France 59% Netherlands 47%

In most countries where the highest percentage of consumers feel that service is more important today, there is a corresponding belief that companies have increased their focus on providing good customer service.

-- 65% of Indian, 49% of Japanese and 47% of Mexican consumers agree with this statement.

However, some consumers are not feeling the love. In Australia (71%), Germany (66%), and Canada and Italy (65% each), consumers say they feel companies haven't increased their focus on service or are paying less attention to it.

This can spell trouble and lost opportunity for companies, given that consumers around the world consistently express a willingness to spend more with companies that provide excellent service.

Average Percentage More That Consumers Are Willing to Spend

India 11% France 8%
Japan 10% Australia 8%
U.S. 9% Canada 7%
Italy 9% U.K. 7%
Mexico 8% Germany 7%
Spain 8% Netherlands 7%




About the American Express Global Customer Service Barometer

The American Express Global Customer Service Barometer research was completed online among a random sample of 1,000 U.S. consumers aged 18+. Interviewing was conducted by Echo Research between April 13 and April 20, 2010. Overall, the results have a margin of error of +/- 3.1% at the 95 percent level of confidence. The same survey methodology was used in Canada, Mexico, France, Germany, Italy, the U.K., Spain, the Netherlands, Australia, India and Japan.

About American Express

American Express is a global services company, providing customers with access to products, insights and experiences that enrich lives and build business success. American Express is a three-time consecutive winner of the J.D. Power Award, has made two consecutive appearances on the BusinessWeek "Customer Service Champs" list and is a recipient of the 2010 Forrester Research Voice of the Customer Award. The Company has also been awarded the Call Center of the Year Award from ICMI for its UK Service center, received the National Award for Excellence in Customer Relationship Management and Contact Centers from the Mexican Institute of Teleservices, and been named the winner of the Customer Experience Category of the Netherlands National Contact Centre Awards. Learn more at www.americanexpress.com and connect with us on www.facebook.com/americanexpress, www.twitter.com/americanexpress and www.youtube.com/americanexpress.

SOURCE: American Express