Verhindern und abbauen der Verbraucherschuld in Europa

Schulden sind in allen europäischen Ländern weit verbreitet. Und obwohl die Ursachen für die Schulden unterschiedlich sein können, sind die Schuldenarten gleich. Sollten Unternehmen beim Verhindern und Abbauen von Schulden ihrer Kunden eine proaktivere Rolle spielen?

 

Europäer im Rückstand

Schätzungen zufolge ist fast jeder zehnte Europäer mit seiner Miete, seiner Hypothek, seinen Wasser- oder Energierechnungen oder anderer Ratenzahlung im Rückstand. Innerhalb der Europäischen Union unterscheiden sich die Zahlen erheblich. Das Problem ist nicht auf bestimmte Länder oder Ursachen beschränkt. Der Rückstand kann in hohen Lebenshaltungskosten, dem Mangel an Arbeitsplätzen, der Belastung durch Studienkredite oder persönlicheren Ursachen wie Vergesslichkeit und schlechter Finanzplanung begründet liegen. Was auch immer der Grund ist, das Thema Verschuldung ist komplex und hängt sehr stark vom Kontext ab.

Die gute Nachricht ist, dass die Anzahl der Verschuldeten sinkt. Die von Eurostat veröffentlichten EU-SILC Umfragezahlen zeigen, dass sich 2017 noch 9,1% der EU-Bürger im Bezahlungsrückstand befanden, während es 2014 noch 12,5% waren.

Schulden und Zahlungsrückstände kommen am häufigsten in Griechenland (44,9%), Bulgarien (33,3%), Zypern (24,8%) und Kroatien (21,4%) vor. Spitzenreiter mit den wenigsten verschuldeten Bürger in der Europäischen Union sind hingegen Luxemburg (3%), die Tschechische Republik (3,2%), Deutschland (4,4%) und die Niederlande (4,6%).

Obwohl die Gründe der Schulden von Land zu Land variieren, sind die Schuldenkategorien, z.B. Wasser- und Energierechnungen, Mietzahlung oder anderer Ratenzahlung europaweit vertreten.

Welche Rolle sollten Unternehmen spielen?

In einer 2013 publizierten umfassenden Studie der Civic Consultancy, mit dem Titel “Überschuldung europäischer Haushalte: Aktualisierte Übersicht der Situation, Art und Ursachen, Effekte und Initiativen zur Einschränkung der Auswirkungen“ wurden eine Reihe vernünftige Empfehlungen ausgesprochen.

Darunter die Notwendigkeit für Kreditgeber und Dienstleister mit Konsumenten im Rückstand proaktiver zu kommunizieren und Ihnen Problemlösungen anzubieten. Die Studie kam außerdem zu dem Schluss, dass eine effektive Umgestaltung darauf abzielen sollte, Verschuldung zu verhindern und abzubauen, anstatt sie nur zu beschränken oder zu verwalten.

Eine Art, wie Unternehmen einfach Kundenverschuldung verhindern können, ist die Verbesserung ihre Kommunikationsstrategie. Für den Anfang bedeutet das, über die Kanäle zu kommunizieren, auf die die Kunden am wahrscheinlichsten reagieren.

Die Notwendigkeit besserer Bezahloptionen

Hindernisse im Bezahlungsprozess zu reduzieren ist der beste Weg, um Zahlungen schneller zu erhalten. Hierbei stehen zwei Aspekte im Vordergrund: Erstens müssen die Kunden besser erreicht werden und zweitens muss ihnen der Zugang vereinfacht werden.

Was das Erreichen betrifft, sollten Sie Ihren Kunden die größtmögliche Auswahl an Zahlungsmöglichkeiten bieten, die es gibt. Wenn Sie auf internationaler Ebene tätig sind, müssen diese Zahlungsoptionen auch die regionalen und lokalen Möglichkeiten beinhalten, denen Ihre Kunden vertrauen und die sie erwarten.

Außerdem sollte Zahlungsmethoden zugänglicher sein. Kunden sollten mit einem Minimum an Klicks ihre Rechnungen bezahlen können. Eine Methode, um dies zu erreichen, ist die Nutzung direkter Zahlungslinks (direct Paylinks). Wenn der Kunde einen Zahlungslink erhält, kann er direkt, und mit der von ihm bevorzugten Zahlungsmethode, bezahlen ohne Zahlungsinformationen eingeben zu müssen.

Die meisten Unternehmen schicken immer noch Briefe und wundern sich, warum so wenig Kunden darauf reagieren. Die Wahrheit ist, dass Kundenvorlieben sich verändert haben. Früher war das Bezahlen von Rechnungen eine Schreibtischaktivität, heutzutage bezahlen immer mehr Kunden Rechnungen mit ihren mobilen Geräten. Sogar wenn sie unterwegs sind. Das ist eine echte Chance für Unternehmen, die schneller bezahlt werden möchten. Um diesem Trend gerecht zu werden, müssen Zahlungsoptionen für mobile Geräte optimiert werden.

Wie wichtig besseres Verständnis von Kunden ist

Organisationen sollten ihre Kunden auch auf persönlicher Ebene besser verstehen lernen. Manche Schulden werden nicht aus finanziellen Gründen verursacht. Viele geraten aufgrund ihres niedrigen Bildungsstandes in finanziellen Rückstand. Komplizierte Briefe in juristischer Fachsprache können zu Missverständnissen führen und werden schnell zur Seite gelegt. Infolgedessen häufen sich die Rechnungen und die Schulden werden unüberschaubar. Vor diesem Hintergrund sind wir vor kurzem eine Partnerschaft mit dem niederländischen Stromanbieter Eneco eingegangen. Zusammen haben wir die neuste Innovation des Kreditmanagements eingeführt: interaktive Videoerinnerungen.

Das interaktive Video ist ein immersives, audiovisuelles Erlebnis, bei dem der Kunde über seine Situation informiert und anschließend zu einer Lösung begleitet wird. Die Videos sind untertitelt und können zu jedem gewünschten Zeitpunkt angehalten oder erneut abgespielt werden. Als Lösungen werden verschiedene Bezahlmöglichkeiten angeboten. Hierzu zählen Direktzahlungen, Ratenzahlung und sogar Zahlungsaufschub. Kunden, denen eine Zahlung nicht möglich ist, erhalten Informationen zur Schuldenhilfe. Ebenso können Kunden die einen Widerspruch einlegen wollen leicht mit einem Zuständigen in Kontakt kommen.

Werden Sie Teil der Revolution

Denken Sie darüber nach, mit einem Finanztechnologieunternehmen zusammenzuarbeiten? Von zukunftsorientierten Banken bis zu Zahlungsplattformen,

Fintech-Unternehmen wie Alphacomm Solutions sind wegweisend in der Verbesserung des Finanzmanagements für Verbraucher. In Europa ist Fintech die größte Anlagekategorie und macht 20% aller globalen Anlagen aus.

 

Kontaktieren Sie uns gerne, wenn sie mehr über die Zahlungserinnerungsplattform von Alphacomm Solutions und deren Vorteile für Ihr Unternehmen erfahren möchten.

 

Alphacomm Solutions whitepaper: how automated payment reminder systems boost your credit management performance

Michael Martens
Head of Sales

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Preventing and resolving European consumer debt

Debt is prevalent in all European countries. Though the causes may differ, the types of debts are similar. Should businesses play a more proactive role in preventing and resolving consumer debt?

Europeans in arrears

It is estimated that close to one in ten Europeans are in arrears with their rent, mortgage, utility bills or hire purchases. Within the European Union, the figure varies considerably. The problem is not limited to specific countries, nor are the causes. Whether it’s the cost of living, lack of employment, the burden of student loans or more personal reasons such as forgetfulness and poor financial planning, the issue of debt is complex and highly contextual.

The good news is that the number has been decreasing. EU-SILC survey figures published by Eurostat show that in 2017, 9.1% of European Union citizens were in arrears, compared to 12.5% in 2014.

Debts and delayed payments are the most common in Greece (44.9%), Bulgaria (33.3%), Cyprus (24.8%) and Croatia (21.4%). On the other hand, top performers within the European Union are Luxembourg (3%), the Czech Republic (3.2%), Germany (4.4%) and the Netherlands (4.6%).

Though the exact underlying reasons for debts may vary per country, the debt categories, e.g. utility bills, rent payments and hire purchases are represented across Europe.

Is there a role for business? 

In a comprehensive study by Civic Consultancy, titled ‘Over-indebtedness of European households: updated mapping of the situation, nature and causes, effects and initiatives for alleviating its impact’ published in 2013, a number of sensible recommendations were made.

Among them, the need for lenders and service providers to be more proactive in contacting consumers in arrears and offering them options. The study also concluded that effective policy should aim to prevent and resolve indebtedness, rather than alleviate or manage it.

One way in which businesses can easily prevent customer debt is by improving their communication strategy. For starters, this means communicating through the channels that customers are most likely to respond to.

The need for better payment options

A sure-fire way to get paid faster, is by reducing friction in the payment process. Two key aspects to focus on are availability and accessibility.

In terms of availability, you should offer your customers the widest range of payment options possible. If you’re operating on an international scale, these payment options must include the regional and local methods your customers have come to trust and expect.

Moreover, the availability of payment methods should be complemented by ease of access. Customers should be able to pay their bills with a minimum amount of clicks. One way to achieve this is through direct paylinks. Upon receiving a paylink, customers are able to pay directly via their preferred payment method without needing to fill in any payment information.

Most businesses are still only sending letters, yet wonder why the response rate is so low. The truth is, customer preferences are changing. Whereas paying the bills used to be a desk activity, nowadays an increasing number of customers are making payments with their mobile devices, even when they’re on the go. This is a real opportunity for businesses aiming to get paid faster. To foster this trend, payment options need to be optimized for mobile devices.

Recommended reading: How automated payment reminders reduce DSO

 

The importance of better customer understanding

Organizations should also understand their customers on a more personal level. Some debts are not caused by financial reasons. Many end up in arrears as a result of low literacy. Complicated letters in legal jargon are easily misunderstood and oftentimes set aside. As a consequence, bills pile up and debts become unmanageable. With this in mind, we recently partnered with Dutch energy supplier Eneco and introduced interactive video reminders as the latest innovation in credit management.

The interactive video is an immersive audiovisual experience in which the customer is informed regarding the situation and then guided towards a solution. The videos include subtitles and can be paused as well as replayed at any time. As for the solutions, various payment options are provided. These include direct payment, payments in instalments and delayed payment. Customers who are unable to pay are provided with information regarding debt assistance. Similarly, customers who would like to dispute the charge can easily get in contact with a representative.

Recommended reading: Interactive video is the latest tool in the fight against late payments

 

Join the revolution

Thinking of joining forces with a financial technology firm? From challenger banks to payment platforms, Fintech firms like Alphacomm Solutions are leading the way in terms of improving financial management for consumers. In Europe, Fintech is the largest investment category, totalling 20% of all global investments.

 

 

Feel free to get in touch with me if you’d like to learn more about the Alphacomm Solutions payment reminder platform and what it can do for your business.

Alphacomm Solutions whitepaper: how automated payment reminder systems boost your credit management performance

Michael Martens
Head of Sales

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Automatic top-up: future-proof or passing fad?

An interview with Alper Altan.

We recently sat down and talked shop with Alper Altan. As the business development manager for Alphacomm Solutions’ top-up platform, Altan has a pretty good idea about where the industry is headed.

To many, top-up is as old as time itself. It’s quite likely that your very first mobile phone was prepaid. In a way, little has changed from the days of the old prepaid Nokia 5110. For most people, topping up credit still means buying scratch cards at the supermarket. Still, one wonders what the next chapter in the evolution of prepaid top-up will be.

That’s a question we all want to know the answer to. As for Alper Altan? He’s convinced the answer is automatic top-up.

What is automatic top-up exactly?

“Automatic top-up is exactly what it sounds like. The credit, is topped up automatically, without any human intervention. It’s completely frictionless and saves users a lot of time.”

Why does automatic top-up matter?

“Automatic top-up is an amazing tool, especially in the prepaid phone market. It makes the entire top-up process a lot more convenient. Let’s be frank, nobody likes to top-up their phone. The process can be quite cumbersome. Say, you’re in the middle of a call and your phone runs out of credit. That’s bad enough, but now you need to leave the house and visit a store somewhere, just to get extra credit. Annoying right? You never really know when you’re going to run out of credit. This is the dilemma that automatic top-up solves.”

So how does automatic top-up work in practice?

“Well, that depends on your credit usage and behaviour. If a user’s usage pattern is rather unpredictable, she could opt for a trigger based on her credit threshold. In other words, once the available credit drops below a certain amount, the payment order for extra credit is automatically placed. Similarly, the automatic top-up can be triggered on a recurring weekly or monthly date. If you know you get paid on time, just set automatic top-up to coincide with that date.”

Why do you feel this is a game changer?

“Automatic top-up gives mobile phone providers the ability to make ‘prepaid’ users more ‘postpaid-like.’ One of the main differences between the two is that postpaid users have signed contracts. Whether he or she uses the phone or not, is totally broke or currently travelling abroad, a postpaid user is required to pay a bill every single month.

A prepaid user with automatic top-up can rest easy. There are no financial consequences of a failed top-up. If the account balance is too low and the payment fails, nothing happens. The user would simply have to do the top-up manually. The next time an automatic top-up is triggered, the system will go ahead and try again.”

So automatic top-up is good for the consumer, but is it good for business as well?

“Of course. You know, one of the biggest challenges facing the prepaid phone market is customer churn. Since top-up is such an inconvenient experience, many users postpone topping up their phone credit for undefined periods of time. Many, influenced by special promotions, may switch SIM cards, opting for the flavour of the month, just to take advantage of temporary benefits.

Automatic top-up flips the script. We’ve seen that for users with automatic top-up, switching SIM cards simply isn’t worth the effort. They become more like postpaid users and stick around a lot longer.”

Any other benefits besides the reduction in customer churn?

“That’s cost reduction. How? Let’s take another look at the example of the postpaid user. If the monthly bill isn’t paid, consequences will follow. First of all, payment reminders are sent. After a couple of months, perhaps they block the phone’s mobile network access. After that, company personnel will have to chase down the user and try their best to get the money owed. If that doesn’t yield positive results either, a bill collector will be tapped to takeover the process.

By this time, the company would have spent considerable human and financial resources in its attempt to collect the outstanding payment. This is rather unfortunate. The last thing a mobile phone provider should be doing, is asking their personnel to chase after unpaid bills.

Offering automatic top-up is a means through which businesses can reap the benefits of having postpaid-like clients that pay on a recurring basis, without any of the risk associated with postpaid.”

At the moment, automatic top-up is mostly used in the mobile phone industry, but where else do you see it being used in the future?

“In theory, automatic top-up can be used in just about any branch of industry with products or services that rely on credit. Public transportation, car parks, school or office cafeterias and online gaming, to name a few, would all be more convenient if we didn’t have to think about reloading prepaid credit. I truly believe the possibilities for automatic top-up  are limitless.”

 

Alper Altan is business development manager for the Alphacomm Solutions top-up platform.

 

 

Alper Altan – Reload Services
Business Development Manager

I’m Alper Altan, Business Development Manager at Alphacomm Solutions. I make sure that Alphacomm maximizes profit on existing customers as well as new business.

More about Alper »


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Are consumers ready for PSD2 (and SCA)?

In my previous articles, I mainly discussed what PSD2 and SCA will mean for businesses. However, all of these developments are and will continue impacting consumers and customer experiences in various ways. In this article, I’d like to shine a light on how these changes will affect consumers.

In a nutshell. the newly revised Payment Services Directive (PSD2) is aimed at improving financial data management. The European Union wants consumers to be in charge of their financial data. Alongside this noble intention, the aim is also to increase competition and foster innovation within the financial sector. Still, do consumers even know what is going on?

Do consumers know what is going on?

While banks and businesses will do their best to make the transition to PSD2 and SCA as smooth as possible, it is true that consumer awareness regarding the pending changes isn’t very high.

Some countries are trying their best to inform and prepare their citizens. In the summer of 2019, Banking & Payment Federation Ireland (BPFI) launched two awareness campaigns in order to alert consumers regarding the possible effects of PSD2 and SCA.

Across Europe, consumers also feel quite differently regarding the changes. For example, the Dutch consider safety when shopping online to be less important than other Europeans. Consequently, in the Netherlands, 52% of consumers are comfortable with sharing biometric data like fingerprints, compared to just 31 per cent in the rest of Europe. Moreover, whereas the Dutch (50%) see speed and convenience as the most important factor when shopping online, the French (62%) and Germans (61%) feel online safety is most important. Research by financial services provider GoCardless has shown this to be the case.

#1 PSD2 will improve the banking experience

As banks share customer data with FinTechs, expect to see an increase and improvement in mobile apps or online services geared towards financial management.

Soon, a customer with accounts at two or three different banks, will be able to use a third party app that sources information from these financial institutions. Third party apps will also be allowed to manage the users bank accounts and make payments on their behalf.

For many consumers, PSD2 will lead to more choice in terms of services, better financial insights and easier financial management.

#2 PSD2 will deteriorate the online checkout experience

A critical part of PSD2 is the introduction of Strong Customer Authentication (SCA). This means that consumers will need to authenticate themselves at checkout by presenting two of the three following elements:

● Something they know (passphrase)
● Something they own (devices)
● Something they are (biometrics)

An online shopper, after logging into the webshop with her password and proceeding to checkout, will be challenged by the bank to authenticate herself via something she owns or something she is. A previously quick checkout experience, suddenly requires the user to take extra steps. In other words, SCA adds friction at checkout and in many cases, friction will lead to cart abandonment.

Still, some lucky businesses, granted they meet certain requirements, will be able to apply for exemptions and offer consumers frictionless flow.

Strong Customer Authentication Alphacomm Solutions

#3 PSD2 will increase privacy concerns

This is the big one. We’re living in an age in which consumers and their government representatives have become more aware of the dangers of data sharing. As with all matters of data sharing, there are many benefits to the consumer, but there’s always that risk of losing control. In the past, data has been shared, bought and sold with wanton abandon. Has the EU done enough to address these fears?

Personal financial data as price of admission?
Ideally, PSD2 opens up the market to allow new startups to launch innovative products that improve the lives of all consumers. Some of these companies will be very strict, adhere to all the rules and never try to gain an unfair advantage through the exploitation of data.

Still, there is also the fear that larger or less honest corporations that provide must-have goods or services, will leverage their popularity (power) in a way that consumers will find themselves handing over their data in order to gain access or receive discounts.

Here is a fictional example: what if a new version of the most popular mobile phone on the market would come at a €200 discount? In return, you’d need to grant access to your bank account, in order for the store to perform a credit check.

Or another one: what if a bigger, better and badder Game of Thrones sequel was only viewable through a popular streaming service’s ‘premium tier’? As a consumer, would you get premium in order to watch the show everybody else can’t stop talking about?

There are benefits to the consumer. By analysing financial patterns alongside viewing patterns, they could indeed make better recommendations or even produce better shows. Is this worth it to you? Like it or not, it will definitely be worth it to many.

Complicated cross-border spats?
European consumers are increasingly shopping across the border. Many don’t always know where businesses are based. If something were to happen, taking (legal) action against a business in another European country other than your own might prove to be a very difficult challenge for most consumers.

Two degrees of separation?
Lastly, the more data consumers share, the less control they have over their privacy. It is even possible for one person’s lack of privacy to affect another person’s data. Even if a particular consumer is totally against sharing financial data, her data isn’t 100% private. Simply transferring funds to a friend, who does share financial data with third parties, can already be enough.

_______________________________________________

In conclusion, personal data, though aggregated and anonymized, can lead to serious consequences when in the wrong hands. However, it can also enrich society and improve the lives of millions in countless ways.

Luckily, companies that want to participate in this open banking system will need to undergo screenings, acquire permits from the central banks of the countries in which they want to operate in and be accountable to various local authorities.

At Alphacomm Solutions, integrity and security are values we hold dear. We have been fighting fraud and securing payments for over 20 years. Looking for advice on how to prepare for PSD2 and SCA? Get in touch with us today.

 

About the author

Joep van Doornik – Payment Solutions
Product Owner

I’m Joep van Doornik, Product Owner at Alphacomm. I make sure that our services remain cutting edge.


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Strong Customer Authentication Alphacomm Solutions

The truth about Strong Customer Authentication (SCA)

Strong Customer Authentication is coming and it arrives – bearing headaches – on September 14th 2019. The impending implementation of SCA is part of the revised Payment Services Directive (PSD2) that came into force on January 18th 2018. 

For a refresher on PSD2, check out our article ‘An explanation of the revised Payment Services Directive (PSD2).’

But what is SCA exactly?

The Revised Payment Services Directive (PSD2) outlines that payments are to be made more secure and that platforms need to be open for integration. SCA specifically, refers to the way in which payments are made more secure. As of September 14th, online shoppers will need to verify their identity by sharing two out of three required elements:

  • Something they know (password, pin, secret fact)
  • Something they own (phone, wearable, hardware token)
  • Something they are (fingerprint ID, facial ID, voice ID, retina scan)

Strong Customer Authentication Alphacomm Solutions

Up until this point, the standard tool used to verify the authenticity of online transactions was the 3D Secure 1.0 system (3DS1). To make this stronger form of authentication possible, an update of the 3D Secure system from 1.0 to 2.0 was necessary. So now, along with the introduction of SCA, card schemes are adopting 3DS2 in order to better comply with SCA.

Don’t get lost in the acronym jungle. It’s pretty clear once you see how they are all connected:

  • PSD2 ⇒ A directive outlining the general goal of open banking, data sharing and security
  • SCA ⇒ A requirement of PSD2, stating that two out of three elements are needed for authentication
  • 3DS2 ⇒ The authentication tool that makes compliance with SCA possible

 

SCA adds friction and hurts conversion

So what does SCA mean for business? SCA is amazing because it makes payments secure and gives businesses a leg up in the battle to eradicate fraud. However, you need to be aware of the drawbacks. SCA adds friction to the shopping experience. Users had just gotten the hang of online shopping and now they need to learn new tricks like using biometrics at checkout. There’s no way of avoiding it. European banks will be required to decline payments that don’t meet the SCA standard.

While we’re waiting for 3DS2, let’s look at 3DS1. In April 2019, Ravelin released a shocking report on the effects of 3D Secure. After analysing millions of global business transactions, they found that 22% of payments were lost as a result of using 3DS.

A study by 451 Research suggests the European economy is likely to miss out on €57 billion in the first twelve months after SCA comes into force.

 

SCA exemptions

Luckily, there are various exceptions to the rule. The following are the most common:

Transactions (partly) outside the EEA
For SCA to apply to international transactions, both countries (that of the user and the seller) need to be located within the EEA. In other words, a transaction between a user in the USA and a German eCommerce website is exempt from SCA. However, some European banks might choose to apply SCA anyway.

People often refer to PSD2, GDPR, SCA etc as European. However, Europe is not synonymous with the European Union and the Union doesn’t quite cover it either. SCA applies to all businesses operating within the European Economic Area (EEA). That’s the European Union, plus Iceland, Liechtenstein and Norway. Note that Switzerland is not part of the EEA.

Low transaction value
Moreover, transactions with a value under €30 are exempt from SCA.

Low transaction risk
Issuing banks or acquirers can apply for an exemption for low-risk payments on the basis of Transaction Risk Analysis (TRA). In order to be considered for the exemption, fraud rates for remote card payments need to be between one and six basis points.

Trusted beneficiaries
After completing a payment with SCA, users will increasingly be able to whitelist trusted merchants. The next time a purchase is made, SCA will be bypassed. Whitelisting will become more commonplace as more card issuers start supporting it.

Excluded / Out of scope

The following transactions are excluded from SCA as they fall outside the scope of the regulation:

  • MOTO: Transactions completed over the telephone or via mail order.
  • MIT: Merchant initiated transactions (MIT) like recurring payments or subscriptions.

Frictionless Flow Alphacomm Solutions

Frictionless flow and chargeback liability shift

The Payment Services Directive (PSD2) includes provisions that allow merchants to soften the blow of SCA to the consumer experience. One such provision is ‘frictionless flow.’

Frictionless flow allows SCA measures to be bypassed. In other words, eligible merchants will be able to offer their consumers a checkout experience without any added friction.

Frictionless flow can only be applied to transactions that meet certain criteria; the size of the purchase in relation to the fraud rate of the merchant (acquirer).

For example, for transactions up to €100, frictionless flow is allowed only if the fraud rate is less than 0.13%. For transactions up to €250 and €500, the fraud rate cap is set at 0.06% and 0.01% respectively.

Frictionless flow is very beneficial to eligible merchants as it minimises the risk of cart abandonment. However, the merchant is liable for any chargebacks that occur through frictionless flow.

Still, there is an exception. If and when an issuing bank does not trust a transaction and refuses to grant frictionless flow, the consumer is presented with an authentication challenge. If the consumer passes the challenge, the chargeback liability shifts towards the issuing bank.

 

What can businesses do to soften the blow?

The bottom line is that conversions affect, well, your bottom line. It is of utmost importance that visitors carry out their purchases as intended, regardless of the new authentication measures. To that end, the best thing you can do is be upfront about it.

Own it. Inform your users that you’re proud to offer a secure shopping experience. Tell your customers that checkout is as safe as it can be because of your adherence to the latest standards. Most of all, tell them early, don’t wait until they are at the checkout phase.

Certain payment methods are intrinsically (in and of themselves) SCA-proof, for example, Apple Pay and Google Pay. Both of which already combine the OWN and ARE elements. Using a payment method like Apple Pay therefore automatically reduces the perceived friction.

Finally, the best thing you can do is ally yourself with an expert in the field of payments. Not sure whether your payment transactions meet the SCA standard? Looking for a partner that offers local payment methods that Europeans love and trust? Alphacomm Solutions can help. Let’s get in touch!

 

About the author

Joep van Doornik – Payment Solutions
Product Owner

I’m Joep van Doornik, Product Owner at Alphacomm. I make sure that our services remain cutting edge.


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