As the payment industry is proceeding in taking steps towards the upcoming Strong Customer Authentication legislation, the European Banking Authorities (EBA) have realized there is a need for a transition period. More and more European authorities have indicated to postpone the deadline for activation of SCA within their jurisdiction. MultiSafepay advises all merchants to still transition their webshop towards SCA regulations regardless of industry progressions. SCA will in time be obligatory either way and applying 2-step verification will improve the security and reduce the risks of potential fraud.
3DS 2.0 and SCA, what will change?
On September 14th, the new Strong Customer Authentication will be enforced, and it will influence the way payments are handled. MultiSafepay, as a collecting Payment Service Provider, implemented all the security and technical measures to abide to the new standard and to provide its clients with a safe and customer friendly payment environment.
What is SCA?
Strong Customer Authentication, as part of the PSD2, is initiated to improve customer authentication during the checkout phase of online purchases. Online transactions, and in particular credit card transactions, will need to undergo at least 2 authentication steps. Following the grace period MultiSafepay will monitor the issuer bank adoption and release the update when needed.
3DS 2.0 will create a default and automated environment where credit card transactions can be assessed, controlled and managed by MultiSafepay and the issuer card bank. MultiSafepay will apply this change automatically for your transactions when required. It will allow online shops to abide to the SCA guidelines at all times and to decrease fraudulent chargebacks.
3D Secure 2.0 and customer checkout experience
Before the update, the 3D Secure 1.0 was merely used to prevent online frauds. The first version of the 3DS security protocol was beneficial to decrease credit card frauds but negatively affected the checkout experience, requiring consumers to complete additional authentication steps on the bank’s website.
With 3D Secure 2.0, the authentication process will be integrated within the checkout and the consumer will not be redirected to the issuer bank’s website to complete the authorization. The update will improve security and will shift liability from the webshop to the card issuer bank. Thanks to the direct communication between MultiSafepay and the consumer bank, the authentication will be completed directly on the checkout page. MultiSafepay and the issuer bank will determine whether the 3DS authentication is required and merchants will enjoy a frictionless and automated 2-step verification process.
Disclaimer: the information in this article has a general informative purpose. Given the changing nature of the law, rules, regulations and information in general, as well as the risks related to electronic communication, there could be delays, omissions or inaccuracies in the information contained in this article. As a result, the information in this article should not be used as a consultation with a professional consultant. We recommend that you consult the competent authority before taking any decision or action. While we have taken the greatest possible care in compiling the information released in this article, MultiSafepay cannot guarantee the completeness, timeliness and / or accuracy of the information. As a result, MultiSafepay accepts no responsibility for direct or consequential damages resulting from the use of, reliance on or actions taken based on information provided in this article.