After more than a year delay, stricter know your customer (KYC) eCommerce rules are set to take effect in the United Kingdom March 14.
The Financial Conduct Authority (FCA), the U.K.’s financial regulatory body, proposed the strong customer authentication (SCA) measures in 2019. They were expected to be implemented last year but were delayed to give retailers more time to prepare.
“We support and welcome the implementation of SCA solutions which protect consumers while minimizing the potential for disruption to customers and merchants,” the FCA said in an announcement .
eCommerce shoppers should be prepared to have their identities checked and perhaps receive more credit card transaction declines, the FCA said.
The new rules require online retailers and payment service providers (PSPs) to verify the customer is who they claim to be prior to processing the payment transaction.
The focus of the implementation has been on 3DSecure, a technology designed to facilitate the authentication of card-not-present (CNP) transactions, according to UK Finance, a trade group for the banking and finance industry. But other SCA solutions are also available in the market, such Apple Pay or Google Pay.
The new rules are intended to enhance the security of payments and limit fraud during this authentication process. They apply when a payer initiates an electronic payment transaction, accesses their payment account online or carries out any action that may imply a risk of payment fraud, the announcement stated.
“We expect firms to continue to take robust action to reduce the risk of fraud,” the FCA said in the announcement.Last year, the FCA collected $775 million in fines thanks to a rise in financial crime fueled by the pandemic.The total comprised fines against major banks, as well as levies against people for insider dealing, non-financial misconduct and carrying out regulated activities with no authorization. —————————— NEW PYMNTS DATA: 70% […]
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