There is no doubt that EMV (Europay, MasterCard, and Visa) cards are here to stay in the U.S. While EMV prevents fraud in the card present space, it does not do the same in the eCommerce/card-not-present (CNP) space.Historically, in regions that have already introduced EMV cards, we have seen that once EMV cards are used by consumers, fraud shifts to the CNP space. In 2012, the total cost of card fraud for U.S. financial institutions, both POS and CNP, was around $8 billion – and all of that card fraud could soon be shifting into the CNP channel.
Cardinal Consumer Authentication is the right complement to EMV for CNP transactions. It leverages the 3-D Secure protocols, and helps financial institutions authenticate their cardholders’ identity prior to authorization. These protocols are known by brand names Verified by Visa, MasterCard SecureCode, American Express Safekey and others.
Liability shifts to the issuer when merchants use Consumer Authentication. (A good rule of thumb is that the party not participating in 3-D Secure/Consumer Authentication assumes liability for any chargebacks. So if the issuer authenticates and the merchant does not, the merchant is responsible. If the merchant participates and the issuer does not, the issuer is liable.)
When used together, EMV cards and Consumer Authentication create a powerful value proposition: they provide financial institutions with control over card fraud and costly chargebacks by better assessing transaction risks and authenticating cardholder identities.
Another key benefit of Cardinal Consumer Authentication is increasing sales. Because a transaction is authenticated before authorization, the issuer has confidence that the transaction is valid and is more apt to authorize an authenticated transaction. CCA also increases sales by reducing false positives – transactions that without authentication might look like fraud and be declined by the issuer. 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.