3D Secure

What is 3D Secure?

(Three-Domain Secure) is a security protocol designed to provide an additional layer of protection for online credit and debit card transactions. It was introduced by Visa and MasterCard, branded as “Verified by Visa” and “MasterCard SecureCode,” respectively. Other major card networks, including American Express (SafeKey) and JCB (J/Secure), also support this protocol. The main purpose of 3D Secure is to help prevent unauthorized transactions and reduce fraud by requiring cardholders to complete an extra verification step during the checkout process.

How does 3D Secure work?

When a customer makes an online purchase with a 3D Secure-enabled card, they are prompted to complete an additional authentication step before the transaction is finalized. This step often involves entering a one-time password (OTP) sent to their registered mobile number, or responding to a push notification from their bank’s mobile app.

The original version of the protocol, known as 3D Secure 1.0, typically redirected customers to a separate page where they would enter their password or OTP. Although effective, this process sometimes caused delays and could lead to cart abandonment.

The updated version, 3D Secure 2.0 (or EMV 3DS), addresses these issues by enhancing the user experience and security measures. It enables more seamless authentication, allowing the card issuer to leverage a wider range of data points to assess the transaction’s risk level. This means that for low-risk transactions, additional authentication may not be necessary, streamlining the checkout process.

Moreover, 3D Secure 2.0 is designed to comply with regulations such as the European Union’s Payment Services Directive 2 (PSD2), which mandates Strong Customer Authentication (SCA) for online transactions. This updated protocol supports various authentication methods, including biometric verification (e.g., fingerprint or facial recognition), ensuring a more secure and user-friendly experience.

For businesses, implementing 3D Secure can significantly reduce the risk of chargebacks and fraud. It’s essential for payment providers to manage 3D Secure flows effectively and apply appropriate exemptions for recurring, low-value, or low-risk transactions. The 2.0 version is also optimized for mobile devices, providing a responsive design that adapts to different screen sizes, ensuring a consistent and secure user experience across all platforms.