As if the travel industry was not complicated enough with its overuse of acronyms and dizzying terms we now have to contend with something known as PSD2.
You may have heard phrases like PSD2, 3D Secure, Strong Customer Authentication, and Two-factor authentication. So what on earth does that mean and how will it impact you? We’ve de-mystified PSD2 below:
What is PSD2 and when does it start?
Quite simply put, PSD2 is the revised version of PSD (Payment Service Directive). It is a European directive that came into force on 1st January 2021. After January 1st, 2021, every online transaction that passes through the EEA must have SCA tied to it – unless an exemption applies.
In summary, PSD2 states that it is no longer sufficient to simply ask for a guest’s credit card for online transactions, but rather a double authentication (known as Strong Customer Authentication or SCA) is now required to authorise the transaction.
This means that at least two of the three factors will be required to complete a transaction:
Source: Stripe
How will this affect me?
PSD2 affects more than just the travel and hospitality sector; it will impact all aspects of retail. Theoretically, PSD2 is to be enforced from 1st January 2021, however, not all banks and/or card issuers are requiring this yet.
As the year goes on, more and more banks are starting to require Strong Customer Authentication for transactions, especially higher value transactions. SCA is aimed at decreasing online payment fraud. Security and trust are very important factors for a great customer experience, which is why we strongly recommend becoming compliant as soon as possible.
What do I need to do?
We’ve been working with our payment vendors/gateways to get all of the systems and processes in place to ensure there is minimal disruption to your business.
Customers that wish to enable Strong Customer Authentication (3D Secure version 1 and 3D Secure version 2), please contact your Global Payments account manager, or email ecomsupport@globalpay.com and request that 3DS v1 and 3Ds v2 be enabled on your account.
We would strongly advise customers to have at least 3Ds v1 enabled, but for future proofing, we would advise to have both 3Ds v1 and 3DS v2 enabled on your account. Not having these enabled will eventually lead to you not being able to process transactions online.
Once confirmed by Global Payments please let the Avvio team know to switch these settings on for your account by emailing support@avvio.com.
We will also continuously review best practices for online payment processing to ensure that your customers have a secure but frictionless online booking experience. In time this may include support for additional payment gateways and methods and may include more secure biometric authentication.
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