With the onslaught of online purchases, it’s in every merchant’s best interest to protect themselves and their customers as much as possible. While there are many options available, Verified by Visa 3D Secure Fraud Prevention is a great option to protect your customer’s information and your business.
Here’s everything you must know.
What is Verified by Visa?
Verified by Visa is an extra layer of protection to ensure the person using the credit card for an online person owns the card. 3D Secure is one of the newest technologies available to prevent fraudulent activities on cards.
This is a necessity for online businesses that accept card-not-present transactions. It’s impossible to tell if the card being used belongs to the person using it, but Verified by Visa makes it easier.
You may remember Verified by Visa as a pop up that almost looked like a scam before. It scared off a lot of customers because it looked like someone was phishing for their information. The latest update using 3D Secure, though is much safer and doesn’t look as threatening to customers.
How does it Work?
3D Secure 2.0 benefits everyone involved in a transaction, including the consumer. No longer does it ask for a password or PIN. The newer version relies strictly on data. But if that data creates a red flag, then it may ask for more information.
Some of the data the system uses is purchase history, IP address, geo location, use of an unknown device, or purchases in excessive amounts among other data. If too many data points are ‘unusual’ it will create a red flag and require more verification before the transaction will be approved.
There isn’t any need to enroll or activate the system either. If the customer’s bank uses 3D Secure, then every card in the system is automatically enrolled. Most of the time, customers aren’t even aware of what’s going on because it happens behind the scenes.
If the system suspects fraudulent activity, they will text the card owner a security code that must be entered to complete the transaction. This is in an effort to prevent unauthorized use of credit cards in card-not-present transactions. If no red flags pop up, the transaction goes through as normal and the consumer doesn’t notice any difference.
Who Should use Verified by Visa?
Any business that operates online should use Verified by Visa. With the increased security chip cards (EMV cards) provide, criminals are looking for other places to steal credit card numbers and eCommerce is one of those areas.
Not only does Verified by Visa protect the customer, but it protects your business too. With a lower risk of fraudulent activity, you’ll have fewer chargebacks, which obviously is better for your business.
It can also make customers more confident in purchasing from your store, knowing that you’re trying to avoid fraudulent use of their credit card.
The Benefits of Verified by Visa 3D Secure
- Simple for customers
Customers often don’t even realize there is security going on behind the scenes to protect them. Since they don’t have to deal with pop ups, remembering a password, or entering any more information, they just see a seamless process and their information being protected.
- May boost sales
Savvy consumers will know about Verified by Visa and only patronize merchants that use it. They may ask before they shop at your store to make sure their information is protected. Consumers may not want to share their credit card information with a company that doesn’t do everything possible to verify the card belongs to them.
- Helpful in Reducing Chargebacks
No merchant likes chargebacks. They are expensive and then can make payment processing harder to get. With a higher transaction approval rate, you don’t have to worry about managing more chargebacks and figuring out how to make your business safer.
- Transfers the liability from you to the card issuer
The last thing you want is to have a customer’s liability on your hands. With Secure 3D, the risk is transferred away from you. If there’s an issue with the card, Visa automatically enforces the passcode requirement, which lowers your risk of fraudulent activity and puts the risk of a stolen card on the issuer, not you.
Are there any Downsides?
There are pros and cons to every situation including using Verified by Visa. Here’s what to consider.
- Customers may feel ‘put out’
If you have a lot of customers whose transactions are deemed ‘risky,’ they will be asked to use the two-factor authentication before they can check out. Even though it’s not your system, but rather the card issuers, it can reflect negatively on you if a customer has trouble using their card at your store.
- There may be additional costs
Every payment processor handles the situation differently. Some charge for 3D Secure and others include it in their pricing. Chances are, though, that you’re paying for it either way, it’s just bundled into the pricing.
What are the Costs?
Every processor charges different fees. To find out what your processor charges, ask about any upfront fees. There may also be plugins you must pay for along with charges to use the service.
Knowing the big picture before you sign up with a payment processor is important and using Verified by Visa should be a feature you want, even if it costs money.
It’s your job to protect your business and your customers when collecting payments online. If you wondered ‘what is Verified by Visa’ and how will it help me, it’s worth looking into it. You’ll get the protection that your business needs and the satisfaction of knowing you’re helping your customers stay safe too.