3D Secure (3DS) is what merchants use to prevent fraudulent transactions. 3DS ensures safe online card transactions and any transaction where the credit card isn’t physically present.
It’s especially critical for high-risk businesses as they have a greater risk of fraud and chargebacks. For high-risk merchants, it’s important to work with an experienced ISO agent like AllayPay to ensure your processing is 3DS-compliant.
Understanding what 3D Secure is
3D Secure is a security protocol for online credit and debit card transactions that adds extra protection against fraud.
Short for “three domain security,” 3DS involves three main parties: the card issuer (the cardholder’s issuing bank), the acquirer (the merchant’s bank), and the payment platform.
The main thing you need to know about 3DS as a merchant is that it’s crucial for preventing unauthorized transactions and reducing the risk of payment fraud on your website.
3DS was originally developed by Visa, but today, most credit and debit card companies use it to secure online transactions. 3DS is used by most major credit card networks, including Visa Secure, Amex SafeKey, Mastercard SecureCode, and Discover ProtectBuy.
How 3D Secure Works
3D Secure authentication involves a quick verification of your customer’s identity and if necessary, sends a one-time code to their mobile phone to verify further. Here’s how it works in practice:
- After entering their payment details for an online purchase, the customer is redirected to a separate 3D Secure page where their payment information is verified.
- The 3DS protocol will check if further verification is required and may prompt the customer to enter a one-time passcode sent to their mobile phone.
And that’s it!
As you can see, the 3D Secure authentication process is quick and easy, causing minimal impact on the customer’s online checkout experience.
Of course, 3D Secure implementation is a bit more complicated, but you can leave that work to your payment service provider.
Why 3D Secure Matters for Merchants
It’s critical for merchants to incorporate 3DS technology for an additional layer of security in their online checkout process. This is particularly true if your business belongs to a high-risk industry (vape sales, CBD, adult, online gambling, etc.).
By verifying your customer’s identity before completing the purchase, 3DS protects businesses from fraudulent transactions and chargebacks.
Letting customers know that you use a secure checkout, like 3DS, can boost trust as well. They’ll feel safer shopping online at your eCommerce site and making purchases, which could lead to more online shopping and sales.
Fortunately, this technology is widely supported by most major credit card companies, making it easy to integrate into your website and customize it to meet your specific security needs.
Do I Need 3D Secure If I Only Use a Card Reader?
No, if you only use a card reader to process card-present transactions (swipe, dip, or tap a card), then 3DS does not come into play and you don’t need to worry about it. 3DS only applies to online, card-not-present transactions.
How to Fit 3D Secure Into Your Payment Security Strategy
Building a strong payment security strategy means using a mix of tools to keep customer data safe, including 3D Secure and other tools that offer encryption and tokenization.
Businesses should also run regular risk checks to find weaknesses and update their systems. Even with protections like firewalls and secure connections, 3DS adds an extra layer of safety by verifying the buyer’s identity during checkout.
Updating your security strategy often, applying the latest security patches, and making sure your strategy includes the latest version of 3DS are all important for helping your business avoid fraud and stay in line with industry regulations such as PCI DSS requirements. Furthermore, they give customers more confidence that your online store is trustworthy.
3DS plays an integral role as part of your broader payment security strategy in the context of your network and payment gateway security.
3D Secure & Network Security
Network security is a key part of keeping payment information safe. It stops hackers from stealing data and helps prevent fraud. For example, using a network security firewall is essential.
Additional tools, like risk assessments, role-based access control, and intrusion detection systems all help ensure network security as well. But when you add 3DS, you give your network an extra shield. Even if someone tries to make a purchase with a stolen card, 3DS can stop the transaction by checking the user’s identity first.
Using network segmentation to separate sensitive systems is also helpful. When combined with 3DS, this setup makes it even harder for bad actors to access customer data.
Finally, businesses should do regular audits and testing of their network. These checks should ensure that 3DS is properly working in the payment flow.
Choosing a security-smart payment provider like AllayPay can help secure your payment process while keeping your business compliant with all of these tasks, including 3DS compliance.
3D Secure & Payment Gateway Security
A payment gateway allows your website to process online payments. Choosing a secure payment gateway that supports 3D Secure is essential to cut down on fraudulent payments and chargebacks.
Most gateways already use essential payment security tools like TLS (transport layer security) and SSL (secure sockets layer) technologies for encryption. With 3DS-enabled payment gateways, identity checks occur with each transaction.
AllayPay offers a number of 3D Secure payment gateways for businesses to choose from.
Choosing a Secure Payment Processor
Picking the right payment processor is a major decision; make sure the one you choose supports 3D Secure authentication. And if your current processor doesn’t support 3DS, it’s high time you switch.
The best processors meet PCI DSS standards and use tools like TLS and SSL. But what sets great processing companies apart is support for 3DS, which offers faster, smarter identity checks during online payments.
Ensure your processor supports 3DS across all types of payments, including mobile payments and recurring billing. This way, your customers are protected no matter how they pay.
Working with a high-quality payment partner like AllayPay is the best way to make sure you are set up with a processor that supports 3DS best practices. We work exclusively with 3DS-enabled gateways, including Authorize.Net, Fluidpay, and several others, making sure your online checkout is equipped with the most up-to-date security standards.
Is My Processor Secure If They Use Other Security Features (but Not 3D Secure)?
Even if your processor already uses encryption and tokenization, 3DS gives you an extra layer of fraud protection by helping stop fraud before the transaction is approved.
Credit card networks may even require 3D Secure in certain regions and for specific transactions.
More importantly, 3DS can also shift the liability for fraudulent transactions from the merchant to the credit or debit card issuer (the cardholder’s financial institution).
How AllayPay Helps With 3D Secure & Payment Security
Our partnership with PAAY helps secure businesses by using 3DS to protect online payments. Their payment solutions makes it easy for merchants and payment providers to set up and manage 3DS.
When merchants use 3DS through us, they can also shift the risk of chargebacks to the card issuer, saving money and reducing disputes.
While always keeping current, we leverage the latest version, 3DS 2.0, with symmetric encryption to ensure that you have an up-to-date, secure system.
Take Action to Protect Your Business With 3D Secure Today
It’s certainly possible to build an eCommerce website that doesn’t include 3DS authentication. But if you cut corners this way, there is a good chance you will regret it.
By being proactive and using a payment processing partner that follows the latest 3DS standards, you won’t have to worry about fraudulent credit card transactions and costly security breaches.
Ready to arm your online checkout with the latest security measures?
Schedule a free consult with AllayPay today and learn how they can protect your business’s payment system, so you won’t have to worry about fraudsters destroying your business.
