How 3D Secure Protects Your Payments

As online and cross-border payments grow in popularity, so too does the need for payment security. This is doubly true for business owners, whose livelihoods depend on protected transactions. A globalised economy means business owners like you build their companies with your sights set on overseas customer bases. You obviously want to know each transaction is safely making its way around the world.

The way we manage this at Qonto is with 3D Secure, or 3DS. In this article, we’ll go over the basics of the 3D Secure process: what it is, how it works, and why it’s important for you.

3D Secure is best thought of like border control for your payments. When you enter a new country, border security checks your passport and any visa documents to make sure you are who you say you are and you’re going where you say you’re going. This means safe entry for both you and the country you’re entering. 3DS protects you in the same way from potential liability when something goes wrong.

The ‘3D’ refers to three domains:

1. The card issuer
2. The receiver of the transaction
3. The platform intercepting the payment

With 3DS payments, when your payment request is sent to Qonto, it travels via an encrypted connection which you then must approve. This is the border control interception point for your payment. You provide another layer of authentication on your mobile device which further protects your funds as they move between you, the bank or financial institution, and merchants you’re paying.

3DS payments are based on a data and payment protection protocol called PSD2 (Payment Service Directive 2) of the EU, which is supervised in Germany by the Federal Financial Supervisory Authority (BaFin). What’s unique about the 3DS process is the strong focus on your personal authentication, which ensures that only you can make payments. The EU has recently released 3DSv2, an updated version of 3D Secure which improves, among other things, user-friendliness.

VISA and Mastercard offer 3D secure under the names Verified by VISA and Mastercard Identity Check.

3D Secure payments require you to take an extra step in authenticating yourself. This is done with either a mobileTAN or in-app push notification. This ensures further that it is for certain you who has executed the payment, therefore allowing it to proceed more safely.

These extra steps of authentication, also called ‘two-factor authentication’ requires two of the following from you:

• Knowledge: a password or code
• Possession: ownership of your device, e.g. smartphone
• Inherence: a biometric feature such as your fingerprint.

Making 3DS payments with Qonto, you will be given the choice between verification methods. You can choose between:

• An SMS to the phone number you have registered with Qonto
• A notification on your paired device

These methods will further protect you and merchants from potential fraud when making payments with Qonto.