3DS 2.0 Authentication Is Coming!
January 29, 2018 / By Alan Nevels
In September, ICBA Bancard partnered with CardinalCommerce to implement a powerful 3-D Secure, 2.0 authentication solution for community bank clients that participate in our Fraud Loss Protection plan.
Very soon, all ICBA Bancard clients will have access to this state-of-the-art technology that not only reduces fraud by way of more successful cardholder validations in the eCommerce channel, but also increases interchange revenue.
According to VisaNet, fraudulent card-not-present (CNP) transactions have increased 22.2 bps in the e-Commerce space post EMV. So too have the number of legitimate CNP transactions that are being declined. Today, 98.4 percent of U.S. card-present transactions are approved compared to an approval rating of 84.1 percent for CNP transactions. While it is understood that CNP fraud has increased as scammers moved to the virtual world for easier pickings post EMV, the higher decline rates for CNP transactions have not translated to more fraud being prevented.
By facilitating a greater data exchange between the merchant and the issuer, 3-D Secure 2.0 enhances protections and offers a more seamless purchase experience by authenticating behind-the-scenes with no cardholder friction. 2.0 uses risk-based authentication, so that only the riskiest transactions (typically fewer than 5 percent) are stepped-up for additional cardholder verification; requiring the cardholder to answer personal identifying information or input a one-time passcode. 3-D Secure 2.0 also works across new and emerging payment channels that include mobile web, in-app, and digital wallet payments, whereas previous iterations of the technology only worked on PC-browser based authentication. Some of the major online retailers such as Amazon, Apple, Best Buy, Google, Microsoft, Priceline, Uber and Walmart currently support the new 3-D Secure 2.0, and that list is growing.
We are very excited about this new service and believe that it will be a game-changer for our clients. Look for an announcement in early April with additional information and enrollment details.
Very soon, all ICBA Bancard clients will have access to this state-of-the-art technology that not only reduces fraud by way of more successful cardholder validations in the eCommerce channel, but also increases interchange revenue.
According to VisaNet, fraudulent card-not-present (CNP) transactions have increased 22.2 bps in the e-Commerce space post EMV. So too have the number of legitimate CNP transactions that are being declined. Today, 98.4 percent of U.S. card-present transactions are approved compared to an approval rating of 84.1 percent for CNP transactions. While it is understood that CNP fraud has increased as scammers moved to the virtual world for easier pickings post EMV, the higher decline rates for CNP transactions have not translated to more fraud being prevented.
By facilitating a greater data exchange between the merchant and the issuer, 3-D Secure 2.0 enhances protections and offers a more seamless purchase experience by authenticating behind-the-scenes with no cardholder friction. 2.0 uses risk-based authentication, so that only the riskiest transactions (typically fewer than 5 percent) are stepped-up for additional cardholder verification; requiring the cardholder to answer personal identifying information or input a one-time passcode. 3-D Secure 2.0 also works across new and emerging payment channels that include mobile web, in-app, and digital wallet payments, whereas previous iterations of the technology only worked on PC-browser based authentication. Some of the major online retailers such as Amazon, Apple, Best Buy, Google, Microsoft, Priceline, Uber and Walmart currently support the new 3-D Secure 2.0, and that list is growing.
We are very excited about this new service and believe that it will be a game-changer for our clients. Look for an announcement in early April with additional information and enrollment details.
Alan Nevels is ICBA Payments' senior vice president of card risk and merchant services.
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