The Changing Cybersecurity Landscape in Housing: 5 FAQs about PCI 4.0 Compliance

Cybersecurity has never been more important for student housing teams and educational institutions, especially regarding payment data. In the United States, losses due to cybercrime surpassed $12.5 billion last year, a 22% increase from 2022 according to Proofpoint. An increasing reliance on digital tools handling vast amounts of sensitive payment data has expanded the attack surface for cyber threats, making it essential to ensure the security of remote connections, devices, and online tools.  

With credit card fraud, identify fraud and stolen data on the rise, meeting the highest security standards has never been more critical. One of those security standards, the Payment Card Industry Data Security Standard (PCI DSS), should be a core component of any housing operation’s security protocol. However, understanding what PCI DSS is and its evolving requirements can be daunting.

Let’s explore 5 key questions surrounding cybersecurity and PCI compliance in student housing.

1. What is PCI compliance and how does it impact housing teams?

The Payment Card Industry Data Security Standard (PCI DSS) was established collaboratively by major card brands, such as MasterCard and Visa. This standard aims to combat fraud by imposing technical requirements on all entities within the payment ecosystem.

Compliance with PCI standards is non-negotiable for entities processing credit card payments. For educational institutions, where credit card transactions often form a significant portion of cash flow, PCI compliance is indispensable. Failing to adhere to PCI standards jeopardizes financial stability and exposes organizations to heightened fraud risks.

Non-compliance can lead to severe repercussions, including payment disruptions. Card brands possess the authority to suspend transactions until investigations into compliance issues are resolved, potentially causing significant disruptions to the student experience and reputational damage for the institution. Investing in secure and compliant platforms is not just a matter of regulatory adherence, but a crucial step in safeguarding financial operations and reputations within the student housing industry.

2. What are the implications of PCI 4.0 for housing teams and vendors?

The advent of PCI DSS 4.0 marks a significant shift in the landscape of payment card standards, with profound implications for the student housing industry. Although plans for its implementation have circulated for some time, the impending deadlines may catch some organizations off guard amidst the busyness of day-to-day operations.

The first compliance horizon, set for March 2024, brings in 13 new requirements. Subsequently, in March 2025, another 51 requirements come into effect. This second group of requirements brings in a range of significant controls such as payment page protection mechanisms that require investment and planning to have in place before the compliance deadline.

Despite being labeled as minor adjustments, the changes for March 2024 are substantial, particularly concerning administrative controls. Every piece of the existing standard has been re-worded and may be interpreted differently by the QSAs who audit against them, necessitating the adoption of more sophisticated systems to meet revised requirements.

It's imperative for every organization to evaluate their PCI compliance status comprehensively. Beyond scrutinizing service and payment providers, internal compliance is paramount, as each institution functions as a merchant and must ensure compliance independently. Addressing any compliance gaps by the first horizon is strongly advised.

Looking ahead to 2025, the requirements are set to escalate considerably, encompassing technical mandates like implementing a Security Information and Event Management (SIEM) system and maintaining round-the-clock security operations center coverage. While this may entail a substantial financial investment, the benefits of robust compliance measures far outweigh the costs.

As the standards become more stringent, we anticipate a discernible decrease in those genuinely meeting compliance standards. Consequently, organizations may encounter vendors claiming compliance without meeting the requisite standards. It's crucial to avoid entanglement in such scenarios, as they may lead to adverse consequences in the long run.

We advocate for all institutions to conduct a thorough review of their vendor relationships, identifying key partners with whom they maintain strong ties. Having as few points of accountability externally as possible minimizes complexities and enhances operational efficiency. Additionally, establishing Service Level Agreements (SLAs) and clear agreements with vendors ensures mutual understanding and accountability, safeguarding against potential compliance pitfalls.

3. What are the consequences of non-compliance with PCI DSS 4.0?  

Discussing the consequences of non-compliance with PCI DSS 4.0 is not about instilling fear but rather understanding the tangible impacts of failing to adhere to regulatory standards. While fines are a potential outcome of non-compliance, the broader risk to businesses and individuals cannot be overlooked.

Residents relying on credit card payments may suffer real-life consequences due to fraudulent activities. Instances of scamming or unauthorized transactions leading to card replacements are not uncommon. PCI mechanisms aim to mitigate such risks by raising the compliance bar, thereby safeguarding individuals and organizations from fraudulent activities.

Non-compliance can result in regulatory fines, which typically commence at around $25,000 for initial offenses. However, persistent non-compliance could lead to more significant penalties, reaching up to $100,000 per month or even a maximum of $5 million, as stipulated by PCI regulations. While the fines are not intended to wipe out businesses, they serve as a deterrent and underscore the importance of adherence to standards.

Beyond reputational risks, data breaches associated with non-compliance carry major financial penalties. The Ponemon Institute estimates the average cost of a data breach to be around $3.86 million. The potential risk underscores the importance of implementing robust security measures to mitigate business risks effectively.

4. What measures does StarRez take to keep customer data secure?

In our commitment to ensuring the security of our customer data, StarRez employs a proactive approach to investment and enhancement. We maintain a dedicated security team, which continues to expand and evolve with each passing year.

Our security team is equipped with specialized expertise, allowing for comprehensive scrutiny and improvement across all aspects of the business. This continual growth ensures that StarRez continues to elevate its security practices, always anticipating and considering emerging threats.

In addition to our dedicated security team, StarRez maintains multiple 3rd party certifications, including:

• SOC 2, which requires strict information security policies and procedures, encompassing the security, availability, processing, integrity, and confidentiality of customer cloud data.
• PCI DSS, which checks our handling of payment processes every year, and we are certified as a Level 1 Service Provider.
• HIPAA-Ready, which ensures that StarRez can help you meet your legal obligations for health care data. We provide granular security controls allowing you to restrict access to just those who need it.
• FERPA-Ready, which means StarRez can agree to act as a school official when it comes to handling regulated student data.
• Cyber Essentials Plus, which helps organizations to guard against the most common cyber threats and demonstrate their commitment to cyber security.

At StarRez, we take security measures beyond the minimum certification standards. One example is active monitoring for password exposure for our community members. A growing trend we’ve noticed is credentials being accidentally exposed as contract developers share code through open forums like GitHub. We scan for these instances and notify the affected parties. This proactive approach is just one example of our passion for security and keeping our community safe.

5. How does a payment integration with StarRez help bolster the security of transaction data?

StarRez completed a significant evolution in our payment processing capabilities to prepare customers for PCI 4.0. Over time, we've collaborated with numerous payment providers. This diversity posed challenges in managing multiple integrations effectively and ensuring robust security across the board.

In response, we began a mission to create a centralized platform for redirections to the best-in-class payment providers to ensure the security of our customers' payment data. Our payments platform prioritizes integrations with select providers that we've identified as leaders in the industry, leveraging our extensive experience and assessment criteria.

Centralizing payment processing offers several advantages. Firstly, it allows us to implement advanced security measures, such as web application firewalls, tailored specifically for payment transactions. By focusing solely on payments, we can ensure the high level of payment security standards is met.

It is also designed for scalability, efficiency, and redundancy, ensuring optimal performance. We are committed to delivering a reliable and seamless service, akin to turning on a tap and expecting water to flow.

StarRez customers are encouraged to engage with their Customer Success Manager to discuss their payment requirements, capabilities, and preferences. Ultimately, embracing technological advancements like a centralized payment platform with best-of-breed integrations is essential for staying ahead in today's rapidly evolving cybersecurity landscape. By proactively adopting innovative solutions, customers can future-proof their operations and avoid the pitfalls of outdated technology and security measures.

Learn more about StarRez security.