New ways to pay require new approaches to security
As we move into a new decade, it seems fitting to reflect on changes our world has seen – from how we consume media and the ubiquity of the smartphone, to the proliferating volume of data, offering opportunities for more personalized and seamless consumer experiences. But these advancements also present challenges around the scale and frequency of cyber threats and breaches.
We have seen significant advances in risk scoring for fraud prevention, encryption and industry specifications for securing new ways to pay to help protect the billions of transactions made by consumers. The continued expansion of digital payments around the world will continue to present challenges and opportunities.
Headline-grabbing data breaches seem to be never-ending. The best defense is to assume your organization is a target and take proactive steps to defend against falling victim or enabling the use of stolen data in your systems. I believe we will see significant growth in adoption of payment tokens and the updated EMV Co.-based 3-D Secure specification globally.
Payment tokens help make transactions safer by eliminating the transfer of actual payment data for e-commerce and mobile payments, and can deliver a seamless yet secure digital payment experience. The updated 3-D Secure specification enables real-time exchange of 10 times more contextual data between merchants and financial institutions to improve decision-making so both parties can better manage fraud in digital channels while optimizing sales.
Traditional approaches to online payment like, manually entering static passwords and payment credentials for every purchase, offer incremental security for digital channels. Fortunately, digital identities make payments faster, easier and more secure when using computers, mobile devices, apps, wearables and future IoT devices.
As fraud threats persist, digital identities can end the use of passwords so consumers can shift to more secure methods of authentication such as face, fingerprint or voice recognition.
European consumers will soon begin to experience Strong Customer Authentication (SCA), the European Union requirements for multiple layers of consumer verification for digital transactions. As many thousands of financial institutions and merchants meet these requirements in Europe, global companies may look to extend the most innovative authentication solutions to other markets.
Consumers globally are demanding greater speed so merchants and FIs will have to respond with faster and safer ways to pay.
This is the first of two parts on new approaches to payment security.