In January 2011, the National Retail Federation, the world’s largest retail trade organization, along with First Data Corporation released results from its latest research study. The information collected from the subjects involved evaluated the data security and fraud prevention strategies practiced at small to mid-sized retailers. In addition to shedding some light on the industry’s current standards, this study also identified many areas of opportunity.

Despite some favorable data, a majority of retailers demonstrated an apparent lack of understanding with regard to the specific types of liability that they could be held accountable for in the event of a data security breach. In fact, an alarming 35% of retailers did not know that they are required by the state to notify credit cardholders through their banks if the information listed on the customer’s credit or debit card was compromised. Disregarding policies like these leaves consumers in the dark when it comes to the security and protection of their personal information.

There are a number of ways that consumers can protect themselves from billing security perils. Here are a few things to consider before trusting a bank or financial institution with your private data:

  • Do they give you access to your information via credit card and bank statements so you can monitor your account? Going paperless can help you avoid the hassle of a stranger walking away with your mail. The upside to this is that you can access the information anytime day or night with the click of a mouse.
  • Do they offer some sort of added protection when logging into your online accounts? Many banks and credit card companies are adopting security images as a way of safeguarding your personal information. Encrypted passwords accompany a photograph as a way of further establishing identity online.
  • How do they handle security breaches like Epsilon? How the company responds to identity theft and fraudulent charges varies largely from state to state. This should be a determining factor as to whether or not you want to keep the account open after all issues are resolved.
  • How quickly are incidents involving billing security handled? What type of response time can you expect after an incident. Again, this reaction can make all the difference as to whether or not you remain a valued customer of a particular bank or lending institution or you take your business elsewhere.

Although no system is perfect, you should know that your bank or credit card company is working hard to safeguard your personal data. If you are concerned that your private information might fall into the wrong hands, consider the information listed above and practice one or two of the ideas yourself. Being well-informed about the possibility of a security breach will help you better understand your rights and responsibilities. You will no longer feel like you have to put down the credit card and can enjoy the purchasing power and rewards options that it offers once again.