Point to Point Encryption

The Standard

The P2Pe Standard defines the requirements that a "solution" must meet in order to be accepted as a PCI validated P2Pe solution. A "solution" is a complete set of hardware, software, gateway, decryption, device handling, etc. Only "solutions" can be validated; individual pieces of hardware such as card readers cannot be validated. It is also a common mistake to refer to P2Pe validated solutions as "certified"; there is no such certification.

The determination of whether or not a solution meets the P2Pe standard is the responsibility of a P2Pe Qualified Security Assessor (P2Pe-QSA). P2Pe-QSA companies are independent third-party companies who employ assessors that have met the PCI Security Standards Council's requirements for education and experience, and have passed the requisite exam. The PCI Security Standards Council does not validate solutions.

How it works

As a payment card is swiped through a card reading device, referred to as a point of interaction (POI) device, at the merchant location or point of sale, the device immediately encrypts the card information. A device that is part of a PCI validated P2Pe solution uses an algorithmic calculation to encrypt the confidential payment card data. From the POI, the encrypted, indecipherable codes are sent to the payment gateway or processor for decryption. The keys for encryption and decryption are never available to the merchant, making card data entirely invisible to the retailer. Once the encrypted codes are within the secure data zone of the payment processor, the codes are decrypted to the original card numbers and then passed to the issuing bank for authorization. The bank either approves or rejects the transaction, depending upon the card holder's payment account status. The merchant is then notified if the payment is accepted or rejected to complete the process along with a token that the merchant can store. This token is a unique number reference to the original transaction that the merchant can use should they ever be needed to perform research or refund the customer without ever knowing the customer's card information (tokenization).

The Solution Provider

According to the PCI Security Standards Council:

The P2PE solution provider is a third-party entity (for example, a processor, acquirer, or payment gateway) that has overall responsibility for the design and implementation of a specific P2PE solution, and manages P2PE solutions for its merchant customers. The solution provider has overall responsibility for ensuring that all P2PE requirements are met, including any P2PE requirements performed by third-party organizations on behalf of the solution provider (for example, certification authorities and key-injection facilities).

Customer benefits

P2PE significantly reduces the risk of payment card fraud by instantaneously encrypting confidential cardholder data at the moment a payment card is swiped at the card reading device (payment terminal) or POI.

Merchant benefits

P2PE significantly facilitates merchant responsibilities:

Point-to-point

A point-to-point connection directly links system 1 (the point of payment card acceptance) to system 2 (the point of payment processing). Therefore, without the involvement of any other systems, not only do payment transactions take less time but there is greater security and confidentiality. A true P2PE solution is determined with three main factors:

1. The solution uses a hardware-to-hardware encryption and decryption process along with a POI device that has SRED (Secure Reading and Exchange of Data) listed as a function.
2. The solution has been validated to the PCI P2Pe Standard which includes specific POI device requirements such as strict controls regarding shipping, receiving, tamper-evident packaging and installation.
3. A solution includes merchant education in the form of a P2PE Instruction Manual, which guides the merchant on POI device use, storage, return for repairs and regular PCI reporting.

End-to-end

Many providers offer end-to-end encryption, which is not part of a PCI validated P2Pe solution. An end-to-end connection may indirectly links system 1 (the point of payment card acceptance) to system 2 (the point of payment processing) but with multiple systems in between and this increases hacker opportunity; may use software encryption; or may not meet the chain-of-custody requirements of P2Pe. Although not typical, an E2Ee solution could allow for decryption of the card data by the merchant since there is no standard to meet. If payment card data exists somewhere within the merchant environment in an unencrypted form, it is risky for both cardholders and merchants as the unencrypted data can be easily read and stolen.

PCI point-to-point encryption requirements

The requirements include:

1. Secure encryption of payment card data at the point of interaction (POI),
2. P2PE validated application(s) at the point of interaction,
3. Secure management of encryption and decryption devices,
4. Management of the decryption environment and all decrypted account data,
5. Use of secure encryption methodologies and cryptographic key operations, including key generation, distribution, loading/injection, administration and usage.

Validated point-to-point encryption solutions

The following payment companies provide security through point-to-point encryption:

Qualified Security Assessors of point-to-point encryption