Study reveals travel industry insights in 3-D Secure authentication
Digital payment service provider Ingenico recently released a study on 3-D Secure payment practices in the travel and airline industry, highlighting wide geographic disparities in the adoption of 3-D secure verification.
The findings reveal more than half (53%) use 3-D Secure in a flexible way. It shows 46% of these suppliers trigger 3-D Secure based on real-time risk assessment and the remaining 54% of travel companies and airlines activate 3-D secure based on the card’s country of issue.
3-D Secure acts as an additional layer of security specifically for online card transactions. It provides an extra barrier to fraud but adds an extra step in the payment process. It typically requires the input of a password linked to the card before authorising the payment.
Both Visa and Mastercard use the protocol, known as Verified by Visa and MasterCard SecureCode respectively. While 49% of businesses said the use of 3-D Secure had helped reduce chargebacks by more than half, there is a downside.
Increased drop-off of more than 10% was reported by 61% of the respondents, suggesting travel companies are taking a selective approach to balance out risk and returns.
Globally, the landscape is fractured in the use of 3-D Secure. Card transactions for The Netherlands, the United Arab Emirates and Saudi Arabia go through 3-D Secure more than 60% of the time while adoption in the Americas is much lower. Less than 5% go through the process in the US, Brazil or Mexico.
As the use of 3D-Secure and the kevel of drop-off varies significantly from country to country, Ingenico suggests a selective approach that takes into account local online purchasing rends.
A total of 106 online travel merchants responded to the survey, and more than 38 million transactions made from January 1 to November 15 2014 were examined.
"The purpose of this study was to give arline and travel e-businesses a better view of common practices and usages of 3-D Secure", said Ludovic Houri, VP of product & payments at Ingenico Payment Services.
"As the study points out, 3-D Secure is not enough to tackle online fraud but helps mitigating risk in certain cases, specifically when combined with a transaction risk analysis tool".
TravelMole Editorial Team
Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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