PCI DSS Third Party Service Provider Assessment

Payment Card Industry Data Security Standard (PCI DSS) compliance extends beyond your four walls. Every third party that stores, processes, or transmits cardholder data on your behalf becomes a potential breach vector. The PCI DSS Third Party Service Provider (TPSP) Assessment template systematically evaluates whether vendors meet the same security standards you're required to maintain.

This assessment goes beyond asking "Are you PCI compliant?" It dissects each PCI requirement into vendor-relevant controls, evidence requests, and validation criteria. For GRC analysts managing dozens of payment-related vendors, this template transforms a complex compliance mandate into repeatable, auditable processes. You'll identify which vendors need full PCI attestations, which can provide network segmentation evidence, and which require additional compensating controls.

The template adapts to different service provider types — from payment gateways requiring full PCI DSS compliance to SaaS platforms that never touch card data but integrate with your payment systems. Each section includes specific evidence requirements, acceptable documentation formats, and red flags that signal deeper investigation needs.

Structure and Core Components

The PCI DSS TPSP Assessment contains 12 primary sections mirroring PCI DSS requirements, plus additional modules for vendor-specific risks:

Requirement Mapping Framework

PCI Requirement	Assessment Focus	Evidence Types
Req 1-2: Network Security	Firewall configs, network segmentation	Network diagrams, firewall rules, DMZ documentation
Req 3-4: Data Protection	Encryption methods, key management	Encryption certificates, data flow diagrams, retention policies
Req 5-6: Systems Security	Anti-virus, patching, secure development	Patch management reports, vulnerability scans, SDLC documentation
Req 7-9: Access Control	User management, physical security	Access control matrices, badge logs, privilege reviews
Req 10: Logging & Monitoring	Audit trails, log retention	SIEM screenshots, log samples, incident response procedures
Req 11: Security Testing	Vulnerability scanning, penetration testing	Scan reports, pentest results, remediation timelines
Req 12: Policy & Procedures	Security policies, training programs	Policy documents, training records, incident response plans

Risk Tiering Methodology

Not all payment service providers pose equal risk. The assessment includes automated tiering based on:

1. Data Access Level

   • Direct cardholder data access (Tier 1)
   • Tokenized data only (Tier 2)
   • No data access but system connectivity (Tier 3)

2. Transaction Volume

   • Over 6 million transactions annually
   • 1-6 million transactions
   • Under 1 million transactions

3. Service Criticality

   • Primary payment processor
   • Backup/failover systems
   • Ancillary services

Industry-Specific Applications

Financial Services

Banks and credit unions use this assessment for merchant service providers, payment processors, and card production vendors. Additional controls cover:

• Regulatory reporting capabilities
• Multi-factor authentication for all administrative access
• Quarterly vulnerability scanning with expedited patching
• Dedicated security operations center (SOC) requirements

Healthcare

Healthcare organizations managing patient payment systems require enhanced privacy controls:

• HIPAA/PCI dual compliance validation
• Separate controls for payment data vs. protected health information
• Business associate agreement (BAA) alignment
• Breach notification procedures spanning both frameworks

E-commerce and Retail

Online retailers assessing payment gateways and shopping cart providers focus on:

• API security controls
• Tokenization implementation details
• Cross-site scripting (XSS) prevention
• Customer authentication methods (3D Secure compliance)

Compliance Framework Integration

The PCI TPSP Assessment maps to multiple frameworks, reducing assessment redundancy:

SOC 2 Type II Overlap

• CC6.1 (Logical and Physical Access Controls) → PCI Requirements 7-9
• CC7.2 (System Monitoring) → PCI Requirement 10
• CC7.3 (Vulnerability Management) → PCI Requirement 11
• A1.1 (Processing Integrity) → PCI Requirements 3-4

ISO 27001:2022 Mapping

• A.8 (Asset Management) → PCI Requirement 2, 9
• A.9 (Access Control) → PCI Requirements 7-8
• A.10 (Cryptography) → PCI Requirements 3-4
• A.12 (Operations Security) → PCI Requirements 5, 10-11

GDPR Article 32 Alignment

Technical and organizational measures required under GDPR Article 32 directly support PCI compliance:

• Encryption of personal data (PCI Req 3-4)
• Regular security testing (PCI Req 11)
• Security incident detection (PCI Req 10)

Implementation Best Practices

1. Pre-Assessment Scoping

Define cardholder data flows before sending assessments. Create a data flow diagram showing:

• Entry points for card data
• Processing locations
• Storage systems (if any)
• Transmission paths
• Third-party touchpoints

2. Evidence Collection Strategy

Structure evidence requests by priority:

Critical Evidence (Day 1)

• Current PCI compliance certificate (AOC or SAQ)
• Network segmentation validation
• Encryption certificates and protocols

Important Evidence (Week 1)

• Vulnerability scan reports (last 4 quarters)
• Penetration testing results
• Security awareness training materials

Supporting Evidence (Week 2)

• Policy documents
• Incident response procedures
• Change management records

3. Automated Scoring Configuration

Configure scoring weights based on your risk appetite:

• Compliance attestation (30%)
• Technical controls (40%)
• Operational maturity (20%)
• Incident history (10%)

4. Continuous Monitoring

Post-assessment monitoring should track:

• Quarterly scan report submissions
• Annual penetration test results
• Compliance certificate renewals
• Security incident notifications

Common Implementation Mistakes

1. Accepting SAQ-A When Inappropriate

Many vendors claim SAQ-A eligibility (lowest requirements) when they actually need SAQ-D. Verify:

• No electronic storage of cardholder data
• Complete outsourcing of payment functions
• No direct post-payment access to card numbers

2. Missing Subservice Provider Reviews

Payment processors often use fourth parties. Your assessment must capture:

• Complete list of subservice providers
• Their PCI compliance status
• Data sharing agreements
• Incident notification procedures

3. Overlooking Tokenization Details

Tokenization doesn't eliminate PCI scope. Validate:

• Token generation methods
• Token storage security
• De-tokenization controls
• Token format (ensuring no PAN reconstruction possible)

4. Insufficient Network Segmentation Testing

"Trust but verify" network segmentation claims:

• Request penetration test reports specifically testing segmentation
• Verify firewall rules blocking card data environment access
• Confirm separate Active Directory domains
• Review network topology diagrams

5. Ignoring Compensating Controls

When vendors can't meet specific requirements, document:

• Specific requirement gaps
• Proposed compensating controls
• Risk analysis justifying alternatives
• Additional monitoring procedures

Frequently Asked Questions

How often should we reassess PCI compliance for critical payment vendors?

Conduct full reassessments annually, with quarterly reviews of scan reports and compliance certificates. Critical Tier 1 vendors touching raw card data need continuous monitoring through API integrations or monthly attestation updates.

Can vendors self-certify PCI compliance, or do we need third-party validation?

Service providers processing over 300,000 Visa transactions annually must use Qualified Security Assessors (QSAs) for compliance validation. Smaller providers can self-assess using SAQs, but request their completed SAQ and vulnerability scan reports from an Approved Scanning Vendor (ASV).

What if our cloud provider refuses to fill out our PCI assessment questionnaire?

Major cloud providers (AWS, Azure, GCP) typically provide shared responsibility matrices and pre-completed assessment packages. Map their standard documentation to your assessment requirements and identify gaps requiring additional evidence or compensating controls.

How do we assess vendors who only handle tokenized payment data?

Focus on token security controls, access management, and connectivity to your cardholder data environment. While tokenization reduces scope, these vendors still need strong security controls, especially around token generation, storage, and potential de-tokenization capabilities.

Should payment vendor assessments differ from our standard security questionnaires?

Yes. Payment vendor assessments must specifically address all 12 PCI DSS requirements and collect evidence of compliance validation. Generic security assessments miss critical payment-specific controls like card data discovery tools, HSM usage, and PCI-mandated logging retention periods.

What evidence proves appropriate network segmentation?

Request network diagrams showing VLAN configuration, firewall rulesets explicitly denying CDE access, penetration test reports validating segmentation effectiveness, and data flow diagrams confirming no unauthorized paths to card data environments.

How do we handle international payment processors with different regional standards?

PCI DSS applies globally, but verify additional regional compliance like RBI guidelines in India or GDPR in Europe. Ensure data localization requirements don't conflict with PCI mandates and that incident response procedures account for multi-jurisdictional breach notifications.