The internet has made significant changes in how consumers shop. Merchant's, however, are still faced with the age old trader's problem of to whom to extend credit to via the use of credit checks, but now with the added pressures of cross border, speed and volume associated with online transactions. Assuring revenue whilst minimising revenue leakage has become a key challenge for online merchants.
Whilst online credit card processing can provide merchant's with an instant authorisation on whether the sales amount is within the credit card's credit limit, there are few systems that can provide real time confirmation on online customers 'bona fides' to use that credit.
Credit checks, or anti fraud processes have become an essential part of online merchant's operations, and in many cases are still manual, slow, expensive, and intrusive. Any additional key stroke prior to a sale concluding or manual intervention such as credit check will drive online customers away.
Payer Authentication provides confirmation that the customer presenting the card during an online transaction is actually the cardholder, and is authorising the use of that particular card for that specific transaction. Merchant Protect provides an automated replacement for expensive, manual, back room credit and anti fraud operations, that works across all card types.
A key advantage to Merchant Protect is that it is post transactional, challenging customers after the sale has concluded and been processed;
Cardholders have 72 hours to authenticate (already processed) transactions. This ensures that sales are not abandoned before completion and processing to credit card, shipments are not delayed, and funds are still being processed and settled in the background, providing every transaction the opportunity to become a successful sale.
This is very different to risk based assessment that automatically rejects transactions costing merchants potential business, or 3D Secure, which intervenes during the sales process, causing a high abandonment rate (up to 52% of sales pushed to 3D Secure are abandoned in the US according to Mastercard).
Merchant Protect automates the process of checking your customers 'bona fides' for first time sign ups, high risk transactions(such as digital products) or generally for high risk merchants . The process uses a dynamic one time password (OTP) and a positive feedback cycle, without the need for additional hardware, complex integration or intrusive customer pre registrations. At no stage do we request customers personal identifiable information (PII), and our process is PCI DSS aloof
Conventional systems have either relied upon ‘predictive’ approaches which are either too restrictive and cost merchants trade, or too permissive and cost merchants chargebacks.
Current systems, such as 3D secure, require complex integration, and rely on static PIN’s. As a result of poor customer experience, 3D Secure has had very low take up in jurisdictions where it is not mandated.
‘Next Generation’ systems are based upon unique, dynamically issued, one time ‘ (OTP) keys’.
Merchant Protect offers an innovative real time credit card payer authentication system, generating dynamic one time use OTP keys as an integral part of a sale transaction. Cardholders retrieve these keys from their existing online banking systems to complete the feedback cycle to the Merchant.
Our system is patented, with Australian Innovation Patent and International Patent Application No. PCT/AU2011/000377.
Merchant Protect provides merchants with positive authentication of bona fides associates with "risky" Card Not Present (CNP) transactions within minutes.
Our aim is to protect the merchant from losses due to fraud, minimise bank chargeback penalties and fees, and mitigate "disputed" transactions. Merchant Protect will reduce third party and friendly fraud, without impacting your business' sales cycle. Our process can automate and replace manual back room credit check and anti fraud operations
By protecting the merchant, we also protect the cardholder.
For issuers:
For cardholders:
Our system is intuitive for merchants and customers.......and it's fast.
There are no intrusive advance sign ups for customers, "dummy" transactions, or delays to customers making or merchants receiving payment. Customers can authenticate near instantly in real time, with complete anonymity.
We can integrate Merchant Protect into your payment system & process flow. As we utilise the existing transactional systems, we do not need to integrate with your bank or gateway. We integrate at your web payments point, keeping integration fast, simple and cheap. Merchant Protect resides as a software agent in the processing chain between the merchant and the acquiring bank.
It is simple to integrate and neither the merchant nor the gateway change any protocols or make changes to their operational flow, except that the merchant waits for authentication to succeed prior to fulfilling the order. Merchants can then mitigate their risk in CNP transactions when provided with the certainty that comes with positive feedback based authentication.
Your customers do not need to sign up to a new payment system, and we do not require access to your customer data. The entire process is anonymous as we do not request or store PII, and is thus secure from data breaches.
Too little transactional scrutiny and your business is exposed to chargebacks. Too much scrutiny, and you lose sales, or "vetting" costs chew into your profits. Industry estimates are that fraud costs up to $2.30 in back office and associated cost for each $1 of direct fraud.
Transaction authentication provides the balance between too little and excessive credit check and anti fraud screening. Unlike predictive or real time analytical anti fraud systems, authentication provides the digital equivalent of a physical signature in the online Card Not Present (CNP) environment, mitigating merchant's liability and losses, and providing peace of mind.
Authentication is a process of validating a person's identity to assure 'he/she is who he/she says he/she is'. This is to reduce the risk of identity fraud. There are three recognised factors of authenticating an individual.
"Something you know", such as a password or PIN.
"Something you have", such as hardware security token or Merchant Protect's soft coded dynamic one time passwords.
"Something you are", such as finger print, a retina scan and others.
A system is said to use strong authentication when it requires at least two of the three factors before access to the system is permitted. This contrasts with traditional single-factor authentication which requires only one authentication factor (usually a password) in order to gain access or permit transaction.
The first factor, 'Something you know', is typically provided by the cardholders financial institution, when a user logs into the financial institutions web site in their normal way.
Merchant Protect provides assurance that, in the case of card transaction originators, 'They are who they say they are' by authenticating a user with the one time password (OTP) which is 'Something you have', the second factor.
Our solution can be aggregated and offered as a service to your merchant's on a user pays basis.
Contact us to discuss how we can partner to bring our antifraud solution to your merchant customer base with a revenue share model.
Merchant's can be individually enabled, with standard or bespoke screening and reporting features to suit their operations.