Regulations such as PSD2 and other Open Banking standards are a challenge for Businesses to provide a seamless checkout experience. Issuers and Merchants are rolling complex implementations that are negatively impacting conversion rates, therefore reducing revenues and reducing trust by users. Global Banking & Finance review of SCA in Europe signals up to 50% drop in conversion rates. [ref]
LoginID's authentication solution for 3DS enables issuers, gateways, and merchants to easily conduct compliant SCA with a user-friendly experience.
The PSD2 Strong Customer Authentication requirement is met by using LoginID's authentication solution (which is FIDO certified and therefore two-factor), and the Dynamic Linking requirement is met by providing a code that is unique to a specific transaction.
The user flow is very straightforward. During a checkout journey the users are shown with the details of the transaction and are prompted to authenticate using their device’s native biometric solution, the same as they would to unlock their device (1st time requires registration). After confirming their intent to complete the transaction by swiping their fingerprint, facial recognition, or whatever their native prompt is, LoginID generates a digital signature which provides the requestor with verifiable proof that the genuine customer consented to that specific action.
LoginID's products are FIDO2 and UAF certified, and are packaged into easy to integrate APIs and SDKs which enable businesses and their customers to get all the benefits of FIDO, with none of the complications. LoginID enables businesses to make decisions for their users based on deterministic factors rather than probabilistic factors (e.g. risk modelling).
When an ACS performs authentication there is a poor checkout experience that results in a drop in conversion rate. As an alternative, merchants can control the Checkout experience through their 3DS MPI provider leveraging the Delegated Authentication programs, such as the programs offered by Visa and Mastercard. The Delegated Authentication programs allows issuers to delegate the SCA to a third party, such as the MPI. The LoginID solution enables the merchant to easily conduct SCA without having to redirect to the ACS, therefore improving the customer journey. After the user authenticates, LoginID can share the authentication information with the ACS resulting in high approval rates. Overall, merchants can assure a better checkout experience for their consumers using the LoginID solution.
For issuers to perform SCA on transaction can be a challenge. Most SCA solutions increase friction and incur in high costs, such as complex Passwords or One-Time-Passwords through SMS or email. These existing SCA are high friction and bad at preventing fraud, such as man-in-the-middle attacks, phishing, and friendly fraud.
LoginID passwordless solution enables Issuers to meet the SCA core requirements of PSD2 and provide a better experience for consumers required to step up during a transaction.
For more information on how to implement LoginID for 3DS contact firstname.lastname@example.org