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What is SCA Optimisation?

 

December 18, 2020 (Investorideas.com Newswire) Delivering a positive checkout experience is essential to support the growth of any business. Fraud detection in eCommerce platforms affects customer experience as well as the credibility of a company-this is where a Strong Customer Authentication (SCA) can help brands create a lasting and enviable reputation among customers.

So, what is SCA and how does it impact your customers' checkout experience, and why should you get SCA optimisation for regulatory compliance? Let's dive in.

What is SCA?

SCA, or Strong Customer Authentication, is a requirement for the eCommerce platforms of companies accepting online payments from Europe. It aims to protect customers from fraudulent transactions online using a multi-factor authentication method that verifies the user's identity.

SCA is a directive set forth by the European Union (EU) in the Revised Directive on Payment Services (PSD2), and it applies to businesses within the European Economic Area (EEA). It came into effect on 14 September 2019, and the deadline for compliance is set for 31 December 2020.

The PSD2 replaces the PSD1-the main difference between the two is the introduction of stronger identity checks in PSD2.

What are the Impacts of SCA?

In a nutshell, what SCA does is prevent fraudulent payments and provide online security for European merchants and customers alike. By adding extra layers of security during the checkout process, SCA shields buyers and sellers from fraudsters.

  • Identity Verification

The two-factor authentication requires the user to answer two of the three questions classified below:

  • Knowledge: something only the user knows, e.g., a password or a PIN
  • Possession: something only the user possesses, e.g., the card or an authentication code generating device
  • Inherence: something the user is, e.g., the use of a fingerprint or voice recognition

While SCA benefits both groups as it reduces online payment anxiety that was quite common before SCA was established, additional steps during checkout can bog down the process and, in some instances, cause customers to abandon their purchase.

In a generation where instant gratification is the norm, this can present a challenge for businesses. These are just some of the things that companies have to consider when strategizing for security on their platforms.

The silver lining is that there are exemptions in which users do not have to go through the authentication each time, such as:

  • When the transaction is recurring (i.e., memberships, subscriptions, etc.);
  • When the single contactless electronic transaction at POS (Point of Sale) does not exceed 50 €, when the total transaction currently on your card does not exceed 150 €, or if you are under five consecutive transactions without having done an SCA; and
  • When the single remote electronic transaction via the Internet on a device does not exceed 30 €, when the total transaction currently on your card does not exceed 100 €, or if you are under five consecutive transactions without having done an SCA.

Compliance to the regulation is essential for business progress, but so is customer experience. This is why you should get SCA optimisation.

What is SCA Optimisation?

SCA Optimisation is a PSD2 decision engine that safeguards the regulatory compliance of your business and streamlines Strong Customer Authentication (SCA) by drawing on the exemptions for a positive customer checkout experience.

SCA Optimisation provides real-time reporting so you stay on top of potential security problems. It has machine-learning capabilities that can detect shifts in fraud patterns and behaviour, effectively learning emerging fraud trends and blocking fraud attempts of all kinds.

Benefits of Using SCA Optimisation

Businesses must not only think about providing checkout security and complying with the PSD2 regulation, but also the experience of the customer because they directly affect cart abandonments.

SCA Optimisation makes sure that happens by reducing customer friction brought about by that extra authentication step required of customers. By minimising the need for SCA challenges and creating a challenge process with minimal customer friction when SCA challenges are required, companies can optimise the checkout experience of their customers and decrease transaction abandonments.

SCA Optimisation supports 3-D Secure authentication, an additional security layer for online credit and debit card transactions used by the world's biggest financial institutions. 3-D Secure is a payment fraud detection solution slated to see its boom in 2022. It's a robust security system trusted by many.

Essentially, this means that, with SCA Optimisation, fraud count is minimised and the need for SCA challenges is reduced as well. SCA Optimisation also takes advantage of all the qualifying exemptions which, again, reduces customer friction. It optimises risk management, screening the best route for transactions, and applying risk-based analysis to all transactions.

Simply put, SCA optimisation satisfies regulatory compliance while making sure your customers still get the best checkout experience.

Get SCA Optimisation for Regulatory Compliance Today

The security at checkout not only drives customer experience but also brand reputation. This is why fraud detection for eCommerce platforms is essential for your business growth. Online payment regulations protect clients from fraud and in turn increase your credibility with your customers, but they also make transactions longer and affect the checkout experience.

Clearly, getting an SCA Optimisation for regulatory compliance as well as a good customer checkout experience is the key that will move your business forward.

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