PSD2: The Perks and Pitfalls of Payment Services Directive in the Digital Payments Space

What is PSD2?

Mandating Strong Customer Authentication

Other Problem Areas With PSD2

PSD2 & Chargeback Policy

PSD2 & Non-EU Merchants

Going Forward With SCA Under PSD2

Separating Good & Bad Friction

  • Making account creation an option, as opposed to mandatory account creation.
  • Offering 3-D Secure verification for participating cardholders.
  • Directing users to a screen to verify orders before submitting them.
  • Using back-end fraud screening tools like geolocation, IP address verification, and fraud scoring and fraud detection software.
  • Requiring complex passwords for user accounts.
  • Embracing alternative payment options like Apple Pay, which employs biometric (thumbprint) verification.
  • In contrast, here are some examples of negative transaction friction:
  • Slow, broken, inconsistent, or complicated site navigation.
  • Unnecessary or redundant information fields during the checkout process.
  • Limited payment options.
  • Not displaying cart totals or shipping information while browsing.

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AltexSoft Inc

Being a Technology & Solution Consulting company, AltexSoft co-builds technology products to help companies accelerate growth.