A high cart abandonment rate across Europe related to eCommerce has been happening, and it is due to the ongoing requirements and PSD2 or Payment Service Provider Directive surrounding the SCA or strong customer authentication. The said concern is that issuers and merchants find it difficult to implement due to factors like high costs, long implementation cycles, and its vulnerability to fraud.
As a result, merchants look for and implement the right kind of SCA and fraud prevention actions for their online activities.
PSD2 Requirement for Strong Customer Authentication
There are two categories that PSD2 fall under articles 6, 7, and 8 that requires at least two from these multi-factor authentications (MFA) elements:
something known – PIN or a password
something owned – laptop, security key, or mobile phone
something you are – fingerprint biometric or face ID
The second category is under article 9.3.a stating the authentication devices must maintain the non-interaction between chosen authentication methods.
SCA Vulnerabilities
The surrounding principle of PSD2, like fido2 key, is designed for fraud prevention, but it is also true that other methods of SCA implementation are not made of equal strength.
Today's tech-savvy fraudsters use social engineering tricks to get around a solid multi-factor authentication. For this reason, online retailers and issuers alike need to pay special attention to the vulnerabilities of their authentication methods to avoid fraudulent activities. For this reason, robust identity verification has become a need by almost all people who have access to eCommerce.
Online fraudsters gain access to several bank accounts of a single user through Social Engineering. Some forms of this come in phishing or man in the middle (MITM) attacks that trick users to provide sensitive information like username and passwords. They may send emails with a link to click that automatically gives access to a user's bank account or online wallets.
So, to avoid fraud, learn more about solid customer authentication for a more secure, private authentication for the future—LoginID.
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