What is the Difference Between PA DSS and PCI DSS?

The PCI-DSS 4.0 security standard for credit card transactions went into effect at the end of March 2024, and supplanted the Payment Application Data Security Standard (PA-DSS) as the primary security standard for all retail transactions.

That said, it’s still important to understand the distinction between PA-DSS and PCI-DSS, as many organizations may still be transitioning to the new standards or dealing with legacy payment applications.

The Payment Application Data Security Standard (PA-DSS) and the Payment Card Industry Data Security Standard (PCI-DSS) require companies to protect credit card information and secure payment portals.

While these standards share a common goal of protecting financial data, they are distinct in their focus, scope, and security requirements. Failure to comply with these standards can result in significant compliance gaps, leaving organizations vulnerable to data breaches and financial penalties.

In this article, we’ll discuss the fundamental differences between PA-DSS and PCI-DSS to give you a comprehensive overview of their respective roles in enhancing payment security.

What Is PCI DSS?

The Payment Card Industry Data Security Standard is a set of technical requirements created by the PCI Security Standards Council (PCI SSC) to protect credit card information during retail transactions.

PCI DSS compliance standards apply to all entities that store, process, or transmit cardholder data, regardless of that organization’s size or sector; although the exact controls an organization needs to implement will depend on the volume of transactions it processes and whether that business has had any prior breaches or non-compliance with PCI standards.

The Payment Card Industry Security Standards Council is an independent organization established by major payment card companies Visa, MasterCard, American Express, Discover, and JCB. It is responsible for oversight and enforcement of compliance with PCI DSS.

Understanding PA-DSS Compliance

The Payment Application Data Security Standard (PA-DSS) regulates software applications that handle cardholder and sensitive authentication data. Its goal was to help software vendors build secure payment software applications that don’t store prohibited data, such as full magnetic stripe, card verification code, CVV2, or PIN block data.

The PA-DSS requirements were derived from PCI DSS requirements and security assessment procedures. So any software applications that store, process, or transmit cardholder data fell under the scope of an organization’s PCI DSS assessment, even if the applications had been validated to meet PA-DSS standards.

While PA-DSS compliance was essential for the security of payment applications, using a PA-DSS-compliant application alone didn’t guarantee compliance requirements with the broader PCI DSS.

Is PA-DSS Still Valid, and What Replaces It?

PA-DSS v3.2 expired in October 2022, and was superseded by the PCI Software Security Framework (SSF). That said, PA-DSS remains available and supported to minimize disruption and ease the transition process for stakeholders.

The PCI Software Security Framework (SSF) aims to provide a more comprehensive and flexible approach to cybersecurity and information security for payment software and validated applications. The new framework includes the PCI Secure Software Standard (SSS) and the Payment Application Best Practices (PABP).

The SSS focuses on secure software lifecycle processes, incorporating security throughout the development lifecycle. It addresses access control, vulnerability management, and other security functionality requirements.

Meanwhile, the PABP guides secure payment application deployments, covering cardholder data environment scoping, PAN storage and transmission, firewalls, and other PCI DSS-compliant best practices.

To Whom Does PCI DSS Apply?

PCI DSS applies to a wide range of organizations, including:

Merchants. This includes businesses of all sizes that accept payment cards for goods and services through physical point-of-sale (POS) terminals or e-commerce platforms.

Service providers. These companies process, store, or transmit payment card data on behalf of merchants. Examples include website hosts and cloud service providers.

Processors. Processors enable merchants to accept payment cards and must ensure that the card transactions meet PCI DSS requirements.

Issuing banks. Banks that issue payment cards must adhere to PCI DSS to secure the cardholder data.

How Does a Company Obtain PCI Compliance?

Merchants must achieve a certain level of PCI compliance based on the volume of their credit card transactions within a given year. The more transactions a merchant processes, the more stringent the compliance criteria are. There are four levels of compliance for merchants and two for service providers.

The method of evaluating PCI compliance varies based on the nature of a merchant’s business and their merchant level. While all merchants must perform an annual assessment to maintain PCI compliance, the merchant level determines who performs that assessment and how detailed that assessment is.

PCI-DSS assessments generally fall into one of three methods:

Qualified Security Assessor (QSA): A QSA is a third-party assessor certified by the PCI Security Council to perform PCI assessments. A QSA is required to evaluate all merchants at Level 1, the highest level of compliance.
Internal Security Assessor (ISA): An ISA is an internal assessor of the assessed organization, such as an internal auditor. The ISA must be certified by the PCI Security Council to perform PCI assessments, but only for his or her organization.
Self-Assessment Questionnaire (SAQ): A SAQ is used by lower-level merchants (with fewer transactions) to self-assess their compliance. Multiple SAQs are available, with the specific SAQ used determined by how customers perform credit card transactions (for example, card not present versus card present).

What Does PA DSS Compliance Mean?

Compliance with PA DSS means a payment application has been independently assessed and validated to meet these security standards. This compliance is vital for software vendors and businesses, as it helps protect cardholder data and that, in turn, enhances customer trust by reducing the risk of data breaches and financial fraud.

What Are PA DSS Requirements?

Below is a general overview of PA DSS requirements:

Avoid storing complete track data, card verification codes, or PIN block data.
Protect stored cardholder data.
Keep a comprehensive log of payment application activity.
Implement authentication features.
Develop payment applications with solid security measures.
Test payment applications regularly for vulnerabilities, and keep them updated as new vulnerabilities are discovered.
Secure wireless data transmissions.
Enable secure remote access to the payment application.
Encrypt sensitive data when transmitted over public networks.
Assure a secure network setup.
Maintain a PA-DSS Implementation Guide for customers, resellers, and integrators.
Never store cardholder data on an internet-connected server.
Designate personnel for PA-DSS responsibilities and provide training for personnel, customers, resellers, and integrators.
Secure all non-console administrative access.

To Whom Does PA DSS Apply?

PA DSS applies to third parties — principally software developers and vendors — that create payment applications to process credit card transactions. So if you develop an in-house payment application, that application would be subject to PA DSS requirements.

What Is the Difference Between PCI DSS and PA-DSS?

The key differences between PCI DSS and PA-DSS are as follows:

Scope and Coverage

PCI DSS. PCI DSS applies to any organization that stores, processes, or transmits cardholder data, regardless of whether that organization develops its payment applications.
PA DSS. This applies to software vendors and developers creating payment applications to process payment card transactions.

Compliance validation

PCI DSS. Compliance with PCI DSS involves a self-assessment questionnaire (SAQ) for smaller merchants or an on-site assessment by a Qualified Security Assessor (QSA) for larger organizations.
PA DSS. Compliance with PA-DSS involves a formal validation process by a Payment Application Qualified Security Assessor (PA-QSA). This means vendors must submit their payment applications for review and approval.

Supervisión

PCI DSS. Major card brands such as Visa, MasterCard, American Express, and Discover require this standard, which the Payment Card Industry Security Standards Council oversees.
PA DSS. PA DSS is under Visa‘s supervision.

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