Different countries – including India and South Africa – have begun to require merchants and credit card issuers to use 3D Secure technology for e-commerce transactions. And there are rumblings that the European Union will soon follow. Could the U.S. be next to mandate 3D Secure?
The good folks here at Instabill think so. In fact, we think it’s inevitable. Card-not-present fraud (CNP fraud) has already started escalating because American consumers are slowly migrating to the use of EMV chip-enabled credit cards. Based on the U.K. migration to EMV credit cards in the early part of the century, as well as Canada in 2008, we can expect CNP fraud to rise significantly.
Right now, 3D Secure is the best defense merchants and issuers have against CNP fraud.
We have gushed about the use of 3D secure and its benefits in past blogs. In asking why merchants and issuers don’t embrace it, it always comes back to one reason: 3D Secure causes disruption in the online checkout process and too often results in shopping cart abandonment.
Merchants and issuers hesitancy is understandable. A seamless online checkout process can make or break a sale. We are, however, approaching a new, somewhat treacherous landscape in the online payments process where fraudsters are at the ready to pounce on vulnerable websites.
Recently Amtrak and Cardinal Commerce teamed for a one-year study in which it implemented consumer authentication on all transactions used by Verified by Visa, Visa’s 3D Secure platform. The result was a 2.4 percent increase in authorized transactions. Additionally, Amtrak enjoyed an 80 percent decrease in fraudulent chargebacks.
Ninety percent of Amtrak ticket sales are online. It found a way to reduce chargebacks and improve online sales while using 3D Secure.
Instabill also offers Verified by Visa, SecureCode by MasterCard, SafeKey by American Express and J/Secure by JCB to its network of merchants. With CNP fraud already on the rise, speak with a merchant account manager about those options and additional security measures at 1-800-318-2713.