Press Release: The Fraud Practice and CardinalCommerce Release the 3rd Annual Consumer Authentication Survey Report After Presenting Key Survey Results at MRC Vegas
Sarasota, FL, March 15, 2016 / The Fraud Practice, Inc.
The Fraud Practice and CardinalCommerce have released the third annual Use of Consumer Authentication in eCommerce white paper, detailing the results of the 2016 Consumer Authentication Survey. Tara Lavelle, VP of Marketing at CardinalCommerce, and Justin McDonald, Sr. Risk Management Consultant with The Fraud Practice, discussed the key findings and highlights from this year’s survey at the MRC Vegas 2016 conference. Previously only made available to those who participated in the survey, this annual report is now available for all to download.
The Use of Consumer Authentication in eCommerce, Annual Survey 2016 white paper report is the third annual installment of this one-of-a-kind survey from The Fraud Practice and CardinalCommerce. It is the first and most comprehensive survey focused on Consumer Authentication, also known as cardholder or payer authentication, which include services such as Verified by Visa and MasterCard SecureCode. This report measures market use, awareness and satisfaction with these programs across all types of organizations, including those who do and do not use or support Consumer Authentication today. Now in its third year, the 2016 Consumer Authentication Survey uncovered several new trends and findings while showing continued improvements in happiness and sophistication of how merchants implement Consumer Authentication, as well as reinforcing the validity of previously seen trends when comparing results year-to-year.
2016 is a pivotal year for card not present risk management and Consumer Authentication. Slowly but surely merchants are upgrading to EMV compliant payment terminals. As the last major payments market to make the transition to Chip cards, the U.S. is expected to see similar effects as felt elsewhere: a decrease in counterfeit card fraud at the point-of-sale but an increase in fraud attempts and losses in eCommerce and other Card Absent channels. Expecting an increase in fraud attempts, online, mobile and multi-channel merchants should consider expanding their risk management tool set.
As the U.S. payments market continues the EMV transition, EMVco is set to release the new Three-Domain Secure (3DS) 2.0 Specifications in 2016, defining and updating the essential messaging protocol for Consumer Authentication programs like Verified by Visa and MasterCard SecureCode. Planned updates to 3D Secure 2.0 will facilitate a more dynamic and risk-based approach with a more streamlined authentication experience across multiple devices and channels. As many merchants added Consumer Authentication services following the EMV rollout and increased CNP fraud attempts in Europe and elsewhere, updates to the authentication process that minimize friction will be welcomed by U.S. merchants considering the addition of these risk management techniques to combat the increased fraud activity and provide a liability shift on covered transactions.
The annual Consumer Authentication Survey serves as a great resource for merchants, payment and fraud vendors, issuers and others in the payments and risk industries. Organizations that currently use or support these services can gain insights on how others implement and make use of these techniques, while merchants interested in learning more about Consumer Authentication can benefit from the experience and perspective of many organizations that have reported a high level of satisfaction and success with implementing these services.
Merchants are showing increased knowledge and awareness around Consumer Authentication services, increased sophistication in how they implement and utilize these tools, higher overall happiness with these services and less impact on the user experience or sales relative to the inaugural Consumer Authentication Survey. For the third consecutive year merchants using Consumer Authentication were less likely to report any negative impacts on the user experience or sales conversion after implementing these services, all while more merchants reported a decrease in chargebacks. Nearly 9-in-10 merchants using Consumer Authentication said they are happy with these services and more than 90 percent say the services are valuable.
One of the goals of this annual survey and report is to increase education and awareness around Consumer Authentication programs and how to bet make use of these techniques. Findings from the 2016 Consumer Authentication Survey show strides in this regard, as 82 percent of merchants who implemented these services in the last year are selectively presenting authentication based on one more factors, compared to about two-thirds of merchants using Consumer Authentication overall. Longitudinal analysis across all three years of the Consumer Authentication Survey indicates that increased education and awareness has led to more merchants implementing these services in recent years, and these are the merchants most likely to be using more advanced implementation techniques like Selective Presentment. Potentially as a result, more merchants are reporting higher satisfaction better results with using Consumer Authentication overall.
These findings, and many others, are discussed further in the Use of Consumer Authentication in eCommerce, Annual Survey 2016 white paper. Please be sure to download your free copy of the full survey results analysis.
About The Fraud Practice
The Fraud Practice, Inc. is a privately held US corporation based in Sarasota, Florida. The Fraud Practice provides consulting services on eCommerce payments, fraud prevention and credit granting as well as prepared research and training for payment and fraud professionals. Businesses throughout the world rely on The Fraud Practice to help them build and manage their payment, fraud and risk prevention strategies.
CardinalCommerce has been a pioneer and global leader in enabling authenticated payment transactions in the card-not-present payments industry since 1999. Through One Connection to our proprietary SafeCloudTM payment platform, CardinalCommerce enables friction-free, technology-neutral authentication and alternative payment services (including digital wallets and mobile commerce services). Cardinal services, partners with and complements most providers in the marketplace to deliver their one connection solution to secure transactions. In accommodating this growing number of payment brands and methods, Cardinal’s platforms serve as universal switches, supporting virtually all merchant platforms, wallets, legacy processing systems and authentication methodologies.