3D Secure 2.0: An extra shield for your fraud prevention toolkit

The 2025 Nilson Report revealed that global card fraud losses reached $33.83 billion in 2023, with the majority of these losses stemming from card-not-present (CNP) transactions, which include online payments. Fraud losses in card payments are projected to continue rising, culminating in $403.88 billion worldwide over the next decade, with North America accounting for a significant share due to its high volume of CNP transactions.

As an Independent Software Vendor (ISV), you can face a variety of security risks related to online payment processing, and 3DS2 can help reduce these risks by providing an additional layer of authentication and fraud protection. Here are some of the security risks that ISVs face, and how 3DS2 can help:

1. Card-not-present (CNP) fraud: CNP fraud occurs when a fraudster uses stolen card information to make a purchase online, and anyone accepting online payments is susceptible to it. 3DS2 helps reduce CNP fraud by providing an additional layer of authentication, such as a one-time password or biometric verification.
   
   
2. Chargebacks: When a customer disputes a transaction, often due to fraud or a billing error, you may have to face chargebacks. Chargebacks can be costly, as you may be required to refund the transaction amount and pay a chargeback fee. 3DS2 can help reduce chargebacks by providing more robust authentication and fraud detection, which can prevent fraudulent transactions from being processed in the first place.
   
   
3. Data breaches: If you are required to store payment information for your business, you are vulnerable to data breaches, which can result in the theft of sensitive customer data. 3DS2 can help reduce the risk of data breaches by providing more robust authentication and encryption of payment data.
   
   
4. Account takeover (ATO) fraud: This occurs when a fraudster gains access to a customer's account and makes fraudulent transactions. 3DS2 can help reduce the risk of ATO fraud by providing more robust authentication, such as biometric verification, that can detect when an unauthorized user is attempting to access an account.

Overall, by providing more robust authentication and fraud detection, 3DS2 can help prevent fraudulent transactions, reduce chargebacks, and protect against data breaches and ATO fraud.

Additionally, 3DS2 offers a range of other benefits as well, including better user experience, support for mobile devices, greater flexibility, and increased transaction success rates. It offers a frictionless flow for low-risk transactions, reducing the likelihood of customers abandoning the payment process due to cumbersome authentication steps. By making the payment process more convenient and seamless, you can enhance user satisfaction and encourage the successful completion of more transactions.

These benefits make it a better option for businesses like you, who are looking to provide a seamless and secure payment experience for your customers. If you are curious to learn more about 3DS2 or other fraud prevention tools, talk to our payments experts.