Chronopay problems or who is your psp?

Several days ago a Russian-dutch Payment Service Provider Chronopay had some security issues.

It is not 100% clear what happened, but a number of credit cards were compromised. Apparently they’ve missed payment on their domain name, which allowed criminals to create a fake payment page and collect some credit card numbers.

May be it’s true, may be not, but I wanted to focus on the situation from prospective of a e-shop customer. What did Chronopay problem could mean for an average credit card user?

First of all, who is the Chronopay and why do they have the credit card information anyway? ¬†People buy products from e-shops, not from Chronopay. It’s actually a bit ironic, but the role of PSP is to manage the operation and security of the credit card operations for the e-stores, so the latter could focus on selling their products – books, CDs, TVs, etc.

If you bought a CD in an e-shop, in most cases the e-shop had never seen your credit card number, it was managed only by Chronopay (or other PSP).

So, when you heard the news about one of the PSP loosing some credit card numbers, how to find out if you should block your card at your bank? How do you know, if your card was managed by Chronopay?

Well, this depend on the e-shops, you’ve used your credit card with. And any of them could have two different contracts with their PSPs:

  • “umbrella contract”, where the PSP is managing everything for a e-shop and transferring the real money just once per month to the merchant bank account. In this situation “Chronopay” should be clearly visible on the credit card statement.
  • “normal contract”, suitable for advanced e-stores, ¬†where the PSP is providing the technology and all the financial operations are performed directly with e-shop’s account by it’s acquirer. In this situation only the name of e-shop will be visible on the credit card statement. You should go to the e-shop itself and try to find any information about which PSP do they use. In most cases it’s clearly stated and even promoted.

Have a save payments and good year 2011!

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