3D Secure Technology

If you are a merchant that processes orders online you have probably heard of MasterCard Secure, Verified by Visa or SafeKey from American Express. You may not have implemented them yet but these are the leading edge of what is known as 3D secure technology. These are tools used to fight online or digital credit card fraud and can help to make credit card transactions safer, which is good for everyone involved except for the thief.

3D stands for 3-domain and not 3-dimensions. The three domains involved in a transaction are the acquirer (the bank and merchant that is being paid), the issuer (the bank of the payer) and the interoperability domain (the moving parts that allow the transaction to be completed). It is XML based and can provide security for both credit and debit card transactions.

The purpose of 3D secure technology is to ensure that online transactions are being made by authorized users. MasterCard Secure and Verified by Visa require a user to enter a passcode to complete a transaction. SafeKey will sent a one-time code to the user who must enter it within 10 minutes in order to complete the transaction. This can work on either a computer or a smartphone.

The benefits for merchants is that not only are transactions more secure but with this extra layer of security it reduces the possibility of a chargeback and can shift liability from the merchant to the bank. Implementing this can also help to reduce interchange fees.

Something like this may not be for everyone and if you have any questions give JLE Business Consultants a call and we can help you out. The cost of implementing something like this is mostly an upfront charge or fee as well as a recurring fee for the software and any plugin that it needs. These fees can be expensive. It should be thoroughly tested before rolling it out to make the transition as seamless as possible. It also adds extra steps to any checkout process so not every merchant will be happy with that and chances are neither will their customers.

We are now in a time when more credit card fraud is perpetrated over the Internet than in actual stores. This will require a fundamental change in the way transactions are processed over the Internet and 3D technology is the tip of that. Is it right at the time for your business? Give JLE Business Consultants a call and we can help you determine if it is. In a way anything that can be done to make online transactions safer is worth it.