Nearly half of UK consumers are likely to abandon future purchases if they are faced with a multi-step authentication process, a study from Forter claims.
The e-commerce fraud prevention company surveyed 1,011 respondents in June 2019 who had completed an online purchase within the past three months. It was comprised of 52% men and 48% women, and 41% between 16 to 34, and 59% 35+.
Its research found that only 34% of respondents were aware of the incoming strong customer authentication (SCA) regulation.
SCA is part of the European directive PSD2 and enters enforcement on the 14 September. This regulation will change online payments made in the EU by needing them to be backed by two-tier authentication.
Online transactions will now need to be conducted with a combination of verification types. There are three possible options for merchants to utilise: knowledge-based verification such as a password or a PIN, an item in possession like a credit or debit card, and finally biometrics which is most commonly a fingerprint.
Worryingly, 49% of the respondents stated they would likely abandon future purchases if additional authentication services were needed.
When asked further, 60% stated they would likely abandon a purchase if they were asked for facial recognition, and 54% said the same for fingerprint ID. Other authentication methods also showed high opposition with email, 3D Secure, and SMS to see rejection from 46%, 45%, and 44%, respectively.
Forter CEO and co-founder Michael Reitblat said, “The UK was one of the first EU markets to confirm a formal delay of PSD2 enforcement. Irrespective of this 18-month delay, fraudsters will continue to capitalise on merchants’ weak spots.
“It is the responsibility of businesses to shore up defences at all stages of the customer journey, and not only at the payment stage. Online merchants shouldn’t use this time as an excuse to hold off on compliance; instead they should work to improve their fraud prevention measures ahead of enforcement.”
Copyright © 2019 FinTech Global
Copyright © 2018 RegTech Analyst
