With the implementation of the European PSD2 regulation, a significant innovation has been implemented in terms of secure access to online payment and banking services: the Strong Customer Authentication (SCA) o Strong Authentication.
What exactly is Strong Customer Authentication (SCA)? How does it work? What are the key factors of Strong Authentication? Let's find out in this guide dedicated to digital payment services.
What is Strong Customer Authentication?
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In the digital payments sector the European Payment Services Directive (PSD2) was implemented with the main purpose of innovating in terms of accessibility and security of payment management and relationships with the banking world.
With the reformist intent of contributing to an important evolution in terms of customer experience, from the 14 September 2019 PSD2 will also come into force in Italy.
The objective is to change the competitive scenario and stimulate a greater openness of the sector to competition, while streamlining the relationship between digital payment services and the User Experience.
In this revolutionary perspective there is the need to increase safety factors and reliability of payment services.
And the implementation of Strong Customer Authentication (SCA) fits 360 degrees into the new regulatory and innovative context.
After all, the e-commerce market is thriving, but the majority of consumers say they still have little trust in digital payments.
There is still too little trust in booking a hotel or purchasing a flight or a ferry ticket via the electronic channel.
Starting from these weak factors that hinder the potential and full development of online booking and e-commerce, Strong Customer Authentication is introduced.
The Strong Authentication it is designed to allow the customer and the type of operation to be carried out to be uniquely identified and authenticated.
The main objective of Strong Customer Authentication is to inhibit or reduce fraud by unauthorized third parties and to enable secure user access to their online accounts.
This purpose of Strong Authentication will allow users to be protected during the completion and conclusion phases of digital payment transactions.
Strong Customer Authentication (SCA): what are the key factors?
All players need to guarantee maximum reliability and security in the payment system, thanks to a new method of authentication and verification of the customer's identity.
If until now it was sufficient to have a credit card number and the payer's email address, with the entry into force of PSD2, the customer will be asked for andeeper authentication.
Therefore, Strong Customer Authentication will verify two of these three elements:
- identification with fingerprint or biometric facial features, which allow the customer's identity to be uniquely verified;
- identification with a password or PIN or security question;
- identification with an electronic device such as a smartphone or a bank token.
Thanks to the Strong Authentication applied to all remote electronic transactions, the customer authentication process will be strengthened, increasing the security of digital payments.
