← Whitepaper: Unleashing the power of Open Finance, Yapily and Ordo collaborate in Covid-19 Fintech tie-up →, Moneybox app announces Open Banking merger with Santander, Revolut customer base to grow by a third by 2021, Open Banking market value to reach $43.15 billion by 2026. This delay actually gives us more time to think about those other important factors that have potentially been overlooked. This takes the UK to a revised deadline of the 14 th of September 2021. @VirginMoney, the UK’s sixth largest lender, suffers 77% drop in pre-tax profits this year due to its half a billi… twitter.com/i/web/status/1…, The owner of @oportun, a San Francisco-based alternative lender, has applied for a banking charter Ultimately, as cross-border commerce returns, we may get a sense of frictions inherent in transactions that cross currencies and time zones, said McLain. By Ramesh Ramani, Head of Banking & Financial Services Europe, Cognizant The UK’s Financial Conduct Authority (FCA) has confirmed an 18-month deadline extension for the introduction of Secure Customer Authentication (SCA) regulations, in an attempt to give firms more time to prepare for the impending Second European Payment Services Directive (PSD2) deadline. It's important that any approach you take to utilizing behavioral biometrics addresses both the positive identification of the customer and bad actors committing fraud. But for those merchants looking to maximise acceptance rates, Damen says this will also mean implementing support for SCA exemptions and exclusions. Damen says this means merchants implementing the capability to authenticate payments using the latest version of 3D Secure. But the opportunity is a fleeting one — as 32 percent of consumers who have been falsely declined will stop shopping with a particular merchant. If firms do not meet the new September deadline, the FCA says they will face the “risk of enforcement action”. improve your experience and our services. Required fields are marked *. GB 202457834 Copyright © 2020 Informa PLC. Nordic Capital acquires RegTech from BearingPoint. The extension is to simply allow for more time to continueworking on PSD2-compliance, notto postpone startingthe process. I did this from the age of 18, and have really enjoyed being out on the course watching the racing. And for the payments ecosystem as a whole, false declines are riskier as merchants encounter a growing population of individuals who have never bought goods or services online before. Acquirers, he said, are obligated by the new regulations to perform transaction risk analysis. The original deadline was 14 March 2021. And eCommerce firms have to navigate the delicate balancing act of preventing fraud but accepting new customers, too — all as transaction volumes swell into the all-important holiday shopping season. At present, only 20% of online transactions go through with SCA. I got into journalism whilst at Durham, writing for the college newspaper and the politics journal, and eventually went to intern at The Times. Because of this, Swiss merchants will need to meet SCA requirements with the same UK full enforcement deadline of 14 September 2021. UK Finance will liaise with all stakeholders and agree on a phased implementation plan with the regulator “as soon as possible”. The FCA also recently welcomed the industry recommendations put forward by UK Finance to focus on behavioral factors as an authentication method. The FCA confirmed the new SCA enforcement date to be 14 September 2021 in the UK. fintechfutures.com/2020/11/san-fr…, . If nothing else, think how fast the last few years have flown by." By continuing to use our website, you agree to the use of such cookies. “It’s hard to say if they are,” said McLain, who added that some issuers have gotten their arms around the shift to multifactor authentication to make online purchases more secure, and some are wrapping things up. Although the full enforcement deadline for SCA is 31 December, 2020, some banks have already begun to enforce SCA by declining a portion of payments that are not SCA-ready (see table below). FCA extends SCA deadline for merchants by six months The UK’s Financial Conduct Authority (FCA) has given merchants another six months to implement strong customer authentication (SCA) for ecommerce due to the “exceptional circumstances” of coronavirus. The UK’s Financial Conduct Authority (FCA) has given merchants another six months to implement strong customer authentication (SCA) for ecommerce due to the “exceptional circumstances” of coronavirus. This takes the UK to a revised deadline of the 14th of September 2021. Looking at the options the banks have, the EBA published an opinion paper that outlines a number of different ways you can achieve inherence through the use of biometrics or customer behavior. SCA Deadline Extension - A Chance to get it right? Not yet, according to McLain, who noted that there will likely still be pain after the deadline — but most stakeholders will adapt in the first quarter of next year. While it’s important to maintain momentum on implementation, the extension does give firms the chance to get it right this time. When I'm not working, I'm usually out trying out new restaurants or at home with the cats. The original deadline has long passed, but the EBA already acknowledged in June that it would have to provide an extension due to challenges arising from a complex payments market , when seeing the obstacles and problems companies were faced with. The comments, as part of a Masterclass on ongoing implementation of SCA, came against a backdrop where, earlier in the year, McLain had told PYMNTS that merchants simply weren’t ready. Read more: EU payments bodies call for further SCA delay. These nascent online shoppers represent a “brilliant market opportunity for every eCommerce company that’s able to give those customers a good experience and make them lifelong customers,” said McLain. The EPA underlines importance of acting fast in consultation on COVID-19... StreamMind launches APP prevention solution in Europe. Thanks! The regulator expects firms “to take all necessary steps to comply with the revised detailed phased implementation plan” which will be discussed with UK Finance, the UK’s trade association for the banking and financial services sector. “We should be looking at SCA as an opportunity to share intelligence with the issuers,” he told PYMNTS, adding that effective use of SCA and exemptions will help merchants reduce frictions, “which ultimately will reduce false declines and increase conversion rates across the board.”, NEW PYMNTS STUDY: ACCELERATING THE REAL-TIME PAYMENTS DEMAND CURVE – NOVEMBER 2020. The deadline extension should however be seen as more of a ‘grace period’, as payment service providers are still expected to be working towards SCA compliance by September 14th. The European Banking Authority (EBA) has released an opinion stating that the revised deadline for migration to SCA has been set at 31 December 2020, a 15-month extension from the original implementation date of 14 September 2019. Banking Technology November issue out now, Without limits: The Barclays accelerator races ahead, Fintech execs race towards workplace diversity. How can I reduce operating costs as the MVP is hugely reliant on costly out of band delivery mechanisms such as SMS? Banks need to be using this extension as an opportunity to find the right long-term solution for them and their customers. FIS’ SVP of product strategy for Worldpay Merchant Solutions, Charles Damen says the deadline extension is “a welcome relief for merchants given the current situation” of coronavirus. “We appreciate that the Commission and the EBA had already extended the initial deadline. Brazil prepares launch of new regulatory sandbox. For example, when criminals use technologies such as BOTs or RAT software to control transactional flows without the customer's knowledge. Identifying a customer when they are interacting with a previously bound device is less forced and far more organic in the transaction flow. Customer experience – am I using the right authentication factors for my customers? He noted that in some countries, such as the Netherlands, things won’t change much, as SCA is already an inherent part of the online checkout process. Following a research exercise carried out in July and August of this year, the EBA assessed feedback of numerous correspondents and found that the 18-month suggestion put forward appeared to be driven significantly by the timeline of the development of 3DS Secure 2. Chinese regulator continues to clamp down on dominant fintech players. The outage was not prevented by the failover solution in place. The solution that you adopt for behavioral biometrics must offer low margins for error. “Over 70% of payments processed today are not compliant with SCA,” says FIS.