Payments Blog

EMV for Financial Institutions: The Risk-Based Approach


In our last blog, we talked about the U.S. EMV liability shift, (those that adapt gain the benefit vs those that don’t) and how Cardinal Consumer Authentication benefits both issuers and merchants with increasing their sales. Today, we will discuss the best way to implement Consumer Authentication for financial institutions. Cardinal Consumer Authentication (CCA) for financial institutions authenticate transactions using risk-based authentication (RIBA).

When issuers use rules to apply a risk-based approach to Consumer Authentication, it creates a better environment for their cardholders by eliminating unnecessary friction at the checkout page and in turn increases authorization rates. CCA uses rules-based approach in which data, history, and information are used to authenticate the cardholder. In only those few suspicious transactions there is a consumer challenge-response required compared to the antiquated authentication way of challenging the consumer (i.e. static username/password, mother maiden name etc.).  RIBA, with real-time data analytics, and historical trends, determines if the risk is high enough to challenge a cardholder. This data is fed into a “Risk Engine” that combines the financial institution’s sophisticated risk models and Cardinal’s Consumer Authentication modeling, to pass, challenge or fail a transaction.

With the EMV deadline fast approaching in the U.S., financial institutions should be taking the lead in protecting their cardholders from fraud by using a risk-based approach.

With Consumer Authentication, everyone wins! The consumer gets to buy, the issuer authorizes more transactions (and makes more money), and the merchant sells more with less fraud (and makes more money)!

With One Connection to Cardinal, we can FutureProof™ your business. Contact us to learn more about the risk-based approach, and stay tuned for next week’s final blog of the series about why you need to implement Consumer Authentication.

Posted by Greg Esser

Greg Esser is currently fully responsible for Product and Sales Engineering for the Global Financial Institution Services Division, where he manages Technical Sales, market analysis and product enhancements across the issuing platform. With more than five years of industry experience, Greg has been a leader in many aspects of the Cardinal organization, spearheading inter-departmental and cross-functional groups tasked with evaluating and building solutions, direct merchant sales, global market services and the Management of Strategic Alliances. Greg’s sales mentality and product experience has played a key role in Cardinal's expansion in the global Card Not Present space. Greg has a B.S degree in Psychology from Heidelberg University.

Find me on: LinkedIn

Sep 15, 2015 10:30:00 AM

Topics: EMV

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