With the PSD2 requirement for Strong Customer Authentication (SCA) going into effect on Sept. 14, 2019, Worldpay, Inc. will launch the SCA Exemption Engine for merchants operating in the European Economic Area (EEA) to reduce friction from the online checkout experience.
Under the SCA requirement, only an acquirer can file exemptions with issuers on behalf of the merchant. Worldpay’s SCA Exemption Engine, which requires little-to-no integration, is a first-of-its-kind solution that employs machine learning to apply the most applicable SCA exemption to an individual payment. The SCA Exemption Engine’s predictive model is built by analyzing Worldpay’s payment data in the region as well as proprietary issuer profiles, which inform the solution’s decisioning.
“With a successful exemption strategy that can also adapt through machine learning, our merchants can prepare for the SCA mandate," said Asif Ramji, chief product and marketing officer at Worldpay, Inc. “The SCA Exemption Engine can help reduce friction during online checkout by asking for an exemption from SCA where possible. Further, as both the acquirer and gateway provider for a merchant, Worldpay can do the transactional analysis to select and apply the best-case exemptions because we have the full view of the payment lifecycle.”
The SCA Exemption Engine works by reviewing eligible exemptions, such as a low-risk transaction, then performing a real-time risk assessment based on shopper, merchant, issuer and payments data – such as buying patterns, deep device fingerprinting, geolocation, issuer preferences, and anomaly detection-focused machine learning. Eligible transactions are then exempt from SCA and may continue onto the issuer for swift authorisation.
The SCA Exemption Engine, coupled with Worldpay’s 3DS Flex which supports both the latest 3DS2 (EMV 3DS) as well as the traditional 3D Secure (3DS) authentications can help merchants reduce costs and complexity by leveraging a true end-to-end service through a single provider.
Worldpay’s SCA Exemption Engine can help reduce the number of transactions a business needs to route via two-factor authentication. If a merchant has also subscribed to Worldpay’s 3DS Flex solution, those transactions not eligible for an exemption will be authenticated to ensure compliance within the scope of PSD2.
The SCA Exemption Engine will be available ahead of the September regulatory deadline, and merchants can subscribe to 3DS Flex now. Further, later this year, Worldpay will expand FraudSight to businesses across the globe, allowing them to turn up their level of security. FraudSight is Worldpay’s next generation omni-channel global fraud detection solution which uses AI and machine learning to prevent fraud and can enhance SCA compliance.
Worldpay is working extensively with regulators, industry associations, issuers, payment networks, partners and merchants to help the industry prepare for PSD2.