Concerned by growing incidents of credit card fraud, the company is in the process of rolling out new point-of-sale (POS) hardware and software at each of the more than 900 Ruby Tuesday restaurants in the U.S. The company is also eliminating its previous practice of storing customer transaction data in its POS systems and has cut the third-party processor that used to handle payment card transactions. Instead, it is directly linked to its merchant bank now.

The wide-ranging moves are aimed at better protecting customers using credit and debit cards, said Nick Ibrahim, senior vice president and chief technology officer at Ruby Tuesday. It will also bring the company fully into compliance with the payment card industry (PCI) data security standard mandate by Visa International, MasterCard Worldwide and other credit card companies.

"This, in reality, is not helping us create more sales," Ibrahim said. "This is purely about the privacy and security of our customers."

Under PCI, Ruby Tuesday, like every other entity that handles payment cards, is required to implement a series of measures, including encryption, stronger access controls, transaction logging and auditing to secure credit and debit card transactions. PCI forbids companies to store transaction data on POS systems and requires companies to ensure that any third-party handling payment card data on their behalf has the required controls in place.

According to Ibrahim, Ruby Tuesday's new POS systems support a much stronger form of data encryption than what was available previously. With it, Ruby Tuesday will also soon be able to accept and conduct credit card transactions at the table itself in the presence customers, he said.