Card Verification

3D Secure is the method by which your customers confirm their identity with their card issuer. When this confirmation is accepted, the purchase is allowed to proceed. Online customers will know this card verification as Verified by Visa and Mastercard’s SecureCode. There are a number of positives for online retailers, though it can also negatively affect conversion rates and online retail revenues.

The benefits of card verification for online retailers

Anything that increases protection for online retailers, and reduces the occurrence of fraud must be good news, right? Card verification processes do exactly this, with four major benefits:

  • They add a level of fraud protection
  • They enable safer online trading by the online retailer
  • They increase customer confidence
  • They reduce costs of chargebacks

Card providers also claim they increase sales, but this is a blanket statement that does not necessarily hold water.

The drawback of card verification

The disadvantage for online retailers is that 3D secure methods act as a blanket solution: they don’t offer any customisable options. While it is true that card verification has an overall positive effect on sales, in some sectors online retailers actually see a slide in conversion rates.

For example, when Verification by Visa is used in the UK by debit card holders, average conversion rates increase by 8%. But among business credit card holders, online retailers see an average 7% decline in sales.

Mobile users suffer with a card verification experience that turns consumers away from the final purchase, and there are several other factors which negatively impact online retailers:

  • The extra time it takes to make a purchase
  • The time and day online shoppers are on-site
  • Repeat shopper numbers
  • Small purchase values are deeply negatively impacted

How to best benefit from card verification

For online retailers, the option to use 3D Card Secure certainly reduces fraud and chargebacks. But online retailers need to be more flexible to take real advantage. Here are the things you need to consider with regards to card verification strategy:

  • First, think about the size and type of sales you’ll be making.
  • Second, ensure your online customers are aware that card verification is for their safety and does not pose a fraud threat
  • Third, regularly examine conversion numbers and adjust strategy accordingly

By considering their customers’ needs, online retailers will benefit from lower chargebacks and decreased levels of fraud while maintaining high conversion rates. Customers want to buy from you, but you must ensure their experience is as good as possible and as secure as possible. Talk to North Payments today to find out how you can make this happen and increase your online sales.

Posted in Merchant Accounts, online payment security, Payment Processing.

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