UK Financial Conduct Authority postpones strong customer authentication implementation for another 6 months

the UK Financial Conduct Authority (FCA) postpone the implementation of strong customer authentication (SCA) additional 6 month rules to minimize disruption to individual consumers and traders.

For the first time, scheduled for September 2019, the SCA guidelines – which require a two-step verification process for online purchases above EUR – have seen several setbacks in the face of increasing pressure from merchants and payment service providers. .

The FCA noted:

“This additional 6-month extension aims to ensure minimal disruption for merchants and consumers, and recognizes the current challenges the industry faces in being ready by the September 14, 2021 deadline. March 14, 2022 is the last on which we expect full SCA compliance for e-commerce transactions. “

FCA added:

“We previously agreed to give businesses more time to implement SCA for e-commerce card transactions in response to concerns about industry readiness, and to limit the impact on consumers and merchants. . We have also provided an additional 6 month extension in response to the coronavirus crisis. We welcome the implementation of SCA solutions that protect consumers while minimizing the potential for disruption to customers and merchants. “

The FCA also mentioned that it still expects companies to continue to take “robust” measures to reduce the risk of potential fraud.

Across Europe, where these guidelines are now enforced, digital commerce traders in France and Spain have reported a reduction of around 25% in conversion rates, a 30% reduction in German markets and up to 40% of transactions would be lost in Europe. Italy, causing millions of euros per month in losses for local traders.

Galit Michel, Vice President of Payments at Forter, said:

“Overall, merchants are struggling to manage the significant changes to their checkout process, and we have observed a lack of issuer preparedness, as well as low levels of customer cooperation with increasing frictions at the box. The desired impact of PSD2 was to reduce the levels of fraud, but in reality the result has been to frustrate customers and deprive traders of much-needed revenue. “