Reduce your cart abandonment and checkout times with PayTabs’s 3DS 2.0 compliance
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OTPs and static passwords are costing you sales
Cart abandonment is an 18 billion USD problem for merchants worldwide. A staggering 7 out of 10 shoppers abandon their carts, making it a major worry for e-commerce businesses. Among mobile users, it’s even higher; 85.65%.
A study in the US found that 18% of shoppers abandoned their cart because checkout is too complex. Another 17% did so because they were worried about their credit card information safety.
Merchants need to offer ease of check out and peace of mind to their customers if they are to address the problem. In MENA, until now, payment gateway providers only offered payment authentication via static passwords and One Time Passwords (OTP/OTPs), which cause high friction and security worries among shoppers.
PayTabs brings you the new risk-based authentication technology, 3DS 2.0, a solution to these problems provided by EMVCo, a global regulatory body for payment safety. PayTabs is among the first companies in the world to become 3DS 2.0 compliant and the very first in Egypt.
What is 3DS 2.0?
3 Domain Secure 2.0 (3DS 2.0) is a new security protocol for authenticating transactions where the cardholder is not physically present.
3DS 2.0 is a complete shift from 3 Domain Secure 1.0 (3DS 1.0), introduced in 1999. Although 1.0 to 2.0 sounds like an upgrade, the two protocols work very differently.
How 3DS 1.0 works
3DS 1.0, shares information and authorizes payments via static passwords and OTPs. It soon proved to be not good enough, as it was,
- High levels of friction
- Risk due to OTP redirects and static passwords
- Incompatible with mobile
- Incompatible with digital wallets
The challenges with 3DS 1.0 persisted, despite the new versions that were released. Buyers kept abandoning carts and merchants kept losing sales. Enter 3DS 2.0.
How 3DS 2.0 works
The key difference between the two protocols is how they authenticate transactions. 3DS 1.0 uses Two-Factor Authentication (2FA). 3DS 2.0 uses Risk-based authentication.
2FA is a static process and does not make any judgements on the transaction risk involved. Risk-based authentication is dynamic and makes assessments based on various factors. The factors include,
- Transaction amount
- Number of transactions within a timeframe
- Cumulative payment amount within a timeframe
- Merchant and country
Risk-based authentication uses biometric data and tokens. A fingerprint is much faster, easier, and secure than any password. Payments Journal has reported a case study where checkout times were reduced by 85% and cart abandonment rates were reduced by 70% after 3DS 2.0 was implemented.
Differences between 3DS 1.0 and 3DS 2.0
| 3DS 1.0 | 3DS 2.0 | |
| Support environment | Browsers only | Browsers, native mobile integration, supports wallets |
| Risk judgement | None used | Risk-based authentication used |
| Data safety | Not good. Redirects to new web pages expose data. | No redirects, therefore safe and effective. |
| Authentication procedure | 2FA | Risk-based authentication |
| Authentication is done via | Dynamic OTPs and static passwords | Biometrics such as fingerprints, voice, palm |
How to switch to 3DS 2.0?
Visa will discontinue support for 3DS 1.0 after October 2022 as the world moves to 3DS 2.0.
PayTabs will help all customers who wish to transition do so for free. Your customers will benefit from the added security and better UX across their browsers, apps, and devices. You’ll be able to enjoy better conversions and sales at no extra cost.
Our tech support will make the switch as seamless as possible for you.
Be one of the first merchants in MENA to integrate 3DS 2.0 security
Show your customers how much you care about their safety and experience. Get an edge over your competitors.
Contact us today and we will help you transition within a couple of days to 3DS 2.0.
– Kasun Pathirage is an expert freelance content writer for B2B fintech and SaaS brands.
Learn more about his work via his website: verbauream.com.
