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What’s 3D Securecosting your business?Amleto MontinariDirector of StrategyChase Paymentech Europe Limited Chase Paymentech...
Background to Chase Paymentech        200+              Years                                         15 Years            ...
AgendaBenefits and Challenges of 3D SecureDiscovering if there is a trend involving 3DSecureReviewing present challenges a...
Let’s look at the costs of fraud.....                            Man                   Potential for                      ...
Fraud Management Systems are the answerto fraud management…or are they?                £               €               $  ...
But Some Say…                       “CNP fraud   Cardholder                     dropped in theAuthentication is           ...
And Others Say…
While The Data Say…                               Relation between 3D Secure Enrollment and Lost checkouts                ...
AgendaBenefits and Challenges of 3D SecureDiscovering if there is a trend involving 3DSecureReviewing present challenges a...
Is There a Trend?Maestro   India    Italy    Singapore   Sweden   Amex     FranceUK & EU   • 2009   • 2009   • 2010      •...
Learn tolive with    3D Secure
AgendaBenefits and Challenges of 3D SecureDiscovering if there is a trend involving 3DSecureReviewing present challenges a...
“Technical”                  challengesConsumers like                 No visibility onauthentication                     r...
1. Technical Challenges                  Cardholder                                              Merchant                 ...
1. 3DS chargeback liability matrix        Visa            o Reason Code 75 – Cardholder Does Not Recognize Transaction   ...
1. 3DS chargeback liability matrix contd.Commercial Cards: Applies when:  1. Authorization Request is Approved  2. ECI 5 (...
2. Fraud Alert Reports
3. Cardholders are looking for signs of     security                       N =546                                     N =5...
Something Is Moving           Static                                               Dynamic password         Password      ...
Summary
Questions?             April
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What's 3D costing your business?

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Presentación de Amieto Montinari, de ChasePaymentech para el I Foro de Medios de Pago y Fraude Online organizado por adigital. (Madrid, 20 de diciembre de 2012).

Published in: Economy & Finance, Business
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What's 3D costing your business?

  1. 1. What’s 3D Securecosting your business?Amleto MontinariDirector of StrategyChase Paymentech Europe Limited Chase Paymentech Europe Limited, trading as Chase Paymentech, is a subsidiary of JPMorgan Chase Bank, N.A. (JPMC) and is regulated by the Central Bank of Ireland.
  2. 2. Background to Chase Paymentech 200+ Years 15 Years 50% of global ecommerce transactions* 222 500 Merchants*approximately based upon 2009 figures
  3. 3. AgendaBenefits and Challenges of 3D SecureDiscovering if there is a trend involving 3DSecureReviewing present challenges and futuredevelopments
  4. 4. Let’s look at the costs of fraud..... Man Potential for hours ChargebacksRFI associated costsChargeback costs False Lost Man Potential fines Potential inability to Positives revenue hours process cards
  5. 5. Fraud Management Systems are the answerto fraud management…or are they? £ € $ £ € £ $ Requests for Lost Product Information Chargebacks
  6. 6. But Some Say… “CNP fraud Cardholder dropped in theAuthentication is UK by 19% to the answer £266.4m in 2009”
  7. 7. And Others Say…
  8. 8. While The Data Say… Relation between 3D Secure Enrollment and Lost checkouts 25% Spain 20% Dropped checkout rate because of Australia France Germany Secure Enrollment 15% United States Canada 10% Italy 5% United Kingdom 0% 10% 20% 30% 40% 50% 60% 70% Cancel Button Hit Rate for 3D Secure Enrollment – Liability Shift Still Applies Merchant Positive – 3D Secure enrolment is notThe Efficient Markets – 3D Secure enrolment is mandated and customer awareness does not matter asmandated and customers enrol customers do not have to enrolMerchant Negative – 3D Secure enrolment ismandated and customers do not enrol
  9. 9. AgendaBenefits and Challenges of 3D SecureDiscovering if there is a trend involving 3DSecureReviewing present challenges and futuredevelopments
  10. 10. Is There a Trend?Maestro India Italy Singapore Sweden Amex FranceUK & EU • 2009 • 2009 • 2010 • 2010 • 2011 • Next• 2008 one?
  11. 11. Learn tolive with 3D Secure
  12. 12. AgendaBenefits and Challenges of 3D SecureDiscovering if there is a trend involving 3DSecureReviewing present challenges and futuredevelopments
  13. 13. “Technical” challengesConsumers like No visibility onauthentication results
  14. 14. 1. Technical Challenges Cardholder Merchant Card# PAReq to ACS PARes with AAVAuthentication SecureCode AAV AAV ACS 3D Secure DirectoryAuthorization AAV in UCAF field 0100 EPS-Net 0110 Issuer Acquirer
  15. 15. 1. 3DS chargeback liability matrix  Visa o Reason Code 75 – Cardholder Does Not Recognize Transaction o Reason Code 83 – Fraudulent Transaction, Card Not Present  MasterCard & Maestro o Reason Code 37 – No Cardholder Authorisation o Reason Code 63 - Cardholder Does Not Recognize TransactionConsumer Cards: Applies when: 1. Authorization Request is Approved 2. ECI 5 (Fully Authenticated) or ECI 6 (Authentication Attempted) is performed and, 3. CAVV, (Visa “Card Authentication Verification Value”), AAV, (MasterCard “Accountholder Authentication Value”) is obtained with an ECI of 5. Not required for ECI of 6. 4. √ = Chargeback Liability Shift for Visa, MasterCard and Maestro. Card Issuance United States Canada European Central Europe, Latin America. So. Asia Location Union Middle East & America and Pacific Africa Caribbean Merchant Location United States √* √ √ √ √ √ Canada √ √ √ √ √ √ European Union √ √ √ √ √ √ Central Europe, Middle East & √ √ √ √ √ √ Africa Latin America. So. America and √ √ √ √ √ √ Caribbean Asia Pacific √ √ √ √ √ √* As of 14 October 2011 for MasterCard and Maestro
  16. 16. 1. 3DS chargeback liability matrix contd.Commercial Cards: Applies when: 1. Authorization Request is Approved 2. ECI 5 (Fully Authenticated) is performed. (ECI 6 DOES NOT provide liability shift except as noted) and, 3. CAVV, (Visa “Card Authentication Verification Value”), AAV, (MasterCard “Accountholder Authentication Value”) is obtained with an ECI of 5. Not required for ECI of 6. 4. √ = Chargeback Liability Shift for Visa, MasterCard and Maestro. Card Issuance United Canada European Central Europe, Latin America. So. Asia Pacific Location States Union Middle East & America and Africa Caribbean Merchant Location United States √ √ √ √ √ √ Canada √ √ √ √ √ √ European Union √ √ ECI 5 or 6 – √ √ √ MC and Visa Central Europe, Middle East √ √ √ ECI 5 or 6 – MC √ √ & Africa Only Latin America. So. America √ √ √ √ ECI 5 or 6 – MC √ and Caribbean Only Asia Pacific √ √ √ √ √ ECI 5 or 6 – MC and Visa
  17. 17. 2. Fraud Alert Reports
  18. 18. 3. Cardholders are looking for signs of security N =546 N =548 N =536 N = 576Specialsecurity 88% 84% 77% 82% code Securitysymbol in 83% 87% 84% 83% browser Q20: To what extent do you agree with each of the following statements? • When making an online purchase I prefer entering a special security code to ensure safety of my payment details. • When making an online purchase I expect to see a security symbol in my browser.
  19. 19. Something Is Moving Static Dynamic password Password OTP device Dynamic password is generated by Password is provided to you by entering your credit or debit card in your bank and is linked to your a card device (OTP), or use a credit or debit card security or access code device After entering user ID and a password, a transaction can only be Dynamic Password Dynamic Password completed with built-in OTP device another password... via SMS Dynamic password is Dynamic password (TAN-code) generated by your card which is generated via SMS sent to has a keypad and LCD screen your mobile phone. embedded into it
  20. 20. Summary
  21. 21. Questions? April

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