Published: May 8, 2023
Reading time: 2 minute read
Written by: Forter Team

At Forter, we aim to help merchants build trust across the entire customer journey, including the payment process. 

Some of our U.S. merchants have started experimenting with 3D Secure 2 (3DS2), an authentication protocol that aims to prevent the unauthorized use of credit and debit cards in card-not-present (CNP) transactions. However, too many U.S. merchants are unaware of the benefits of using 3DS2, and some have expressed concerns regarding the U.S. market’s general state of readiness.

How can U.S. merchants benefit from 3DS2?

The main benefits of 3DS2 for U.S. merchants include the following:

Chargeback Liability Shifted to Issuers

3DS2 shifts the chargeback liability from merchants to issuers with some limitations. This change in liability means you won’t have to absorb the costs of fraudulent transactions in many cases. However, you are still responsible for disputes that occur for reasons other than fraud (for example if the customer is unhappy with the quality of the goods purchased). 

Frictionless Authentication in Many Cases

3DS2 enables merchants to share more information with the issuer. The issuer uses this information to assess the risk of the transaction, allowing trusted customers to proceed without having to complete a challenge. You decide whether to apply 3DS to a transaction, but the issuer decides if your customer will have a frictionless 3DS authentication experience. Forter sees 65% of 3DS requests in the U.S. authenticated without the need to present a challenge.

Better User Experience Across Devices

3DS2 provides an enhanced authentication experience for users across devices and platforms. The design works well on mobile devices and is compatible with in-app transactions, mobile wallets, and e-wallets. You can make the authentication process look and feel consistent with your mobile app or website, giving customers a seamless and user-friendly experience.

Add Friction to Risky Transactions Pre-Auth

When merchants apply 3DS with a smart solution like Forter that sits pre-auth, you can send borderline risky transactions through 3DS (that otherwise would have been declined). This increases your risk approval rate and helps you capture more revenue.

Forter’s Payment Optimization Solution

Our payment optimization solution leverages our Smart 3DS solution, which enables you to make intelligent decisions about which transactions to send through 3DS based on issuer behavior and preferences so you can maximize conversions while minimizing friction and cart abandonment.,  Our holistic solution, which enables you to optimize conversions across each step in the payment flow, includes the following core capabilities:

  • Issuer Optimization — We share insights with issuing banks and card networks — including Visa, Mastercard, and CapitalOne — which influences their decisions about risk, increasing your authorization rates.
  • Smart 3DS — Our solution helps you intelligently decide which transactions should go through 3DS (and Frictionless 3DS) to minimize friction while optimizing for auth rate and chargeback reduction.
  • Tokenization — We provide a processor-agnostic tokenization solution that helps manage your customers’ credit card data and gives you the flexibility to work with any PSP/Gateway.

With Forter, you can build trust across the payment ecosystem by optimizing payment decisions. Better payment decisions mean you can shift chargeback liability, increase authorization rates, and improve conversion rates.

Click here to see how you can make the most of 3DS2 using Forter’s Payment Optimization solution.

2 minute read