The Financial Conduct Authority (FCA) has extended the introduction of strong customer authentication (SCA) rules till March 2022 to reduce disruption to consumers and merchants.
The introduction of the SCA rules was originally scheduled to be implemented in September 2019. The FCA have faced mounting pressure and a number of setbacks from merchants and payments players on the introduction of SCA, which demands a two-step verification process for all online purchases over Euro.
An example of the opposition to the SCA rules came in April 2020, when the original deadline for the implementation delayed due to pushback from both merchants and consumers alike.
It has also been found that across Europe – where the rules have already been introduced – ecommerce merchants from Spain and France have witnessed a 25% reduction in conversion rates. Elsewhere, there has been a 30% reduction in Germany and 40% of transactions have been lost in Italy.
The FCA said in a statement, “This further 6-month extension is to ensure minimal disruption to merchants and consumers, and recognises ongoing challenges facing the industry to be ready by the previous 14 September 2021 deadline. The new 14 March 2022 deadline is the latest we expect full SCA compliance for ecommerce transactions.
“We previously agreed to give firms extra time to implement SCA for card-based e-commerce transactions in response to concerns about industry readiness, and to limit the impact on consumers and merchants. We also provided an additional 6-month extension in response to the coronavirus crisis.”
The organisation concluded that it welcomed the implementation of SCA solutions which protected consumers while minimising the potential for disruption to customers and merchants. It also mentioned it still expected companies to take robust action to reduce the risk of fraud.
Copyright © 2021 RegTech Analyst
Copyright © 2018 RegTech Analyst
