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P2Pe vs E2EE: Which Should You Choose?

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The GoCardless content team comprises a group of subject-matter experts in multiple fields from across GoCardless. The authors and reviewers work in the sales, marketing, legal, and finance departments. All have in-depth knowledge and experience in various aspects of payment scheme technology and the operating rules applicable to each. The team holds expertise in the well-established payment schemes such as UK Direct Debit, the European SEPA scheme, and the US ACH scheme, as well as in schemes operating in Scandinavia, Australia, and New Zealand. See full bio

Last editedDec 20212 min read

If your business accepts card payments, it’s your responsibility to keep cardholder data safe. Encryption is one powerful tool at your disposal, but there are multiple standards to choose from when it comes to encrypting data – two of which are the E2EE and P2PE compliance standards. Here’s a closer look at how to choose between P2PE vs E2EE to best suit your business needs.

What is the P2PE meaning?

The P2PE meaning stands for point-to-point encryption, a standard created by the PCI Security Standards Council. PCI P2PE requirements focus on protecting physical point-of-sale equipment like card terminals as well as cardholder data. Point-to-point links connect sales terminals with payment processing systems via a secure third party. Data is encrypted at one point and decoded at the end point, with the third-party processor reviewing it for security during transfer.

By following these PCI P2PE requirements, you can help keep customers secure from data breaches as well as physical tampering with devices.

What is the E2EE meaning?

By contrast, E2EE stands for end-to-end encryption. While it also encrypts data from one end of the transaction to another, the link is indirect in this case. A single entity encrypts cardholder data at the point of payment before it is transferred through the network to the payment processor. However, this network doesn’t review the data in any way. Instead, it’s left encrypted until it reaches the processor, who decodes it at the other end.

During the E2EE process, encryption can be performed by any single party, whether its internal or external. By contrast, the P2PE connection involves a direct third-party link that manages the full process.

P2PE vs E2EE standards

When comparing P2PE vs E2EE, there are a few key differences to be aware of in terms of security standards and compliance.

1. Security rules

P2PE systems follow clear standards spelled out in the instruction manual. Businesses are required to carry out all annual inventory checks as well as monthly site checks to ensure your POS equipment meets all P2PE compliance and standards. For example, cameras should be installed in any physical premises with terminals to monitor access. E2EE doesn’t involve such a strict set of rules for the business.

2. Encryption process

With E2EE, the business decides which data to encrypt. For PCI compliance, all cardholder data must be encrypted, but you can decide whether smaller things like headers should also be encrypted. With P2PE, encryption must follow all PCI standards for the storage and transport of data. A third-party transaction processor will hold the keys with P2PE, while an E2EE system allows the merchant to hold encryption keys.

3. Liability

An E2EE system offers greater flexibility for the merchant, but this also leads to full liability if data is lost or stolen. You choose how to encrypt data, but if this is leaked your business will be liable. By contrast, a P2PE system uses a formal assessor to review security at each stage. The P2PE network is therefore liable for providing a secure process.

Which standard should you choose?

How can you choose between P2PE and E2EE systems? It depends on the size of your business and how many card transactions you process. Larger businesses will probably benefit more from P2PE, which outsources compliance to a third-party network to ensure compliance across multiple locations.

By contrast, small businesses can get by with an E2EE system instead. It requires less time for processing at a lower cost. Because the service is more complex with P2PE, this type of system will usually cost more than E2EE. In the end, you should look at your business’s infrastructure and volume of data handling to choose the right plan.

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