Australian e-commerce merchants urged to introduce Visa authentication

Merchants that are at risk of fraud must implement Verified by Visa service by 1 October 2014

Australian e-commerce merchants that experience a high degree of fraud will be required to offer Visa’s online security service, Verified by Visa (VbV), from 1 October 2014.

VbV is an online authentication service which confirms a customer’s identity when they are about to purchase items.

According to Visa's senior director of risk services, Ian McKindley, the requirement was made due to a rise in card not present (CNP) fraud.

He cited 2013 data released by the Australian Payments Clearing Association (APCA) which indicated that CNP fraud in Australia increased 5 per cent over the past 12 months ending June 30 to $198.9 million.

This compared with CNP fraud statistics from 2012 which showed a total of $183 million.

“The companies targeted by CNP fraud included airlines, computers, software, electronics, music, telecommunications, travel and gambling. The VbV service brings a simple addition to the online checkout process that will support a reduction in online fraud,” he said in a statement.

McKindley added that companies who offer VbV are protected from fraud-related chargebacks on Visa cards.

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2 Comments

Gordon Drennan

1

If Visa increases the number of online merchants who are required to implement Verified by Visa, and so make it harder for customers to do business with them, PayPal will be laughing. It'll be great for PayPal's business.

Ronald Duncan

2

We implemented Verified by Visa when it first came out about 10 years ago. Initially for the first 5 years it was only turned on for suspected fraudulant transactions. Then some customers turned it on for all transactions.

In about 2010 Maestro made it manadatory, and our default setting for merchants changed to Maestro on other cards off.

Now we have more merchants that turn it on for all cards. Particularly government bodies, where your customer has to purchase, and the government does not want any risk, and so takes advantage of the liablity shift offered with Verified by Visa.

All of our integrations support Verified by Visa so it is a standard part of the package with our ecommerce websites, and the same goes for the payment gateways such as Cybersource. The gateways all support verified by Visa.

Based on my experience most people are now getting used to the technology and there will not be much if any drop off it is mandatory accross all card schemes.

Over in the EU it will be mandatory by for all payments to use the latest secure password version by 1 Feb 2015.

So there is a global drive towards the use of Verified by Visa.

Ronald Duncan
CloudBuy

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