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Confused about your 3DS compliance? Recent industry updates and a new ZOOZ service

3DS Compliance

What’s up?

With COVID-19 affecting every area of life and the financial world, in particular, Visa has recently announced that it is delaying its BER (Business Enhancements Release) from April to July, which is a protocol that usually requires additional actions on the merchants’ side, to comply with evolving regulations and requirements. This delay also affects the Refund Authorization Mandate, among others.

At this time though, Visa is trying to relieve merchants from added complexities. Among other things, they are currently implementing a Dispute Monitoring Program (beginning April 1) to help maintain the integrity of the dispute process by reducing the occurrence of invalid disputes initiated in the system. The program will monitor daily dispute volumes, with a focus on consumer-related disputes, and will flag any practices that may be inconsistent with current Visa dispute rules, and if necessary, require issuers to reverse invalid disputes. Mastercard has also indicated that they are putting the time and effort to support small businesses through this crisis, with a commitment of $250 million over five years to support businesses in the US and in other markets in which they operate.

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What about 3DS 2.1? 

With all the mayhem we’ve been facing in the past couple of months, you might have missed the fact that 14 March 2020 marked the date which Visa set for European issuers to have 3D Secure 2.1 in place. The current situation has put such immense pressure on merchants and banks, that regulators are working closely with the industry to agree on which changes, if any, need to be taken and implemented regarding milestones and timeline. It is important that even considering the current situation, to still have in mind the future deadlines and needed actions

Why it's important

While e-commerce has shown great growth even prior to COVID-19, recent events have boosted it even further.  Consumers are flocking online stores and basically shifted their buying habits online. This fact makes 3DS even more important as it is designed to increase the fortification of CNP (Card Not Present) transactions, and make the environment safer as well as to increase approval rates as more transactions will be flagged as safe in advance. 

A quick reminder: what is 3DS 2.1 all about?

3DS 2, launched 14 April 2019, is an authentication protocol introduced by EMV Co., and major card brands, to help consumers authenticate their identity while making card-not-present transactions. 3DS 2 - the improved version of its predecessor 3DS -  is designed to support new payment channels (e.g. digital wallets), as well as reverse the trend of low conversion rates, false card declines, customer cart abandonment, and fraud. It’s also a key component for complying with PSD2-SCA requirements -  With more context around each payment, issuing banks should be able to make more accurate authorization decisions in a way that provides a frictionless experience for the consumer. Further reading on the subject can be found here.

Upcoming Deadlines 

Until published differently, the following are the official deadlines for the implementation of 3DS 2.1

  • 1 July 2020: 3DS 2.1+ is Mastercard’s mandate for issuers and is an interim version of 3DS between versions 2.1 and 2.2. It adds some of the functionalities of 2.2 (especially exemptions)
  • 14 September 2020: 3DS 2.2 Visa mandate for issuers
  • October 2020: American Express (Issuers & acquirers) must implement 3DS 2.2
  • 16 October 2020: Visa (Acquirers) must be ready for 3DS 2.2
  • 31 December 2020: Visa to end support for 3DS1 
  • 1 January 2021: SCA will be implemented on all payments (14 March 2021 in the UK)
  • September 2021: Merchants should be prepared to support 3DS 2.2 

ZOOZ 3DS solution

We are working hard on a 3D Secure Authentication service for the use of both by existing customers and external ones. The solution will help merchants reduce the needed PCI scope for external 3DS authentication. It will also route transactions via the appropriate 3DS flow. Our online exemption engine will take decisions in real-time and help merchants to manage regulatory requirements and the growing prevalence of 3DS support throughout the market.

To find out more about this service make sure to contact our customer success team at Support@zooz.com  today.  

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COVID-19 Pushes #homecommerce to the Forefront

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Payments 101: Learn the Fundamentals

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