Mastercard SecureCode: What It Means for Your Business
Payment security is top of mind for business owners in the modern age. Cash-free transactions are on the rise and hackers are always finding new ways to take advantage.
Mastercard SecureCode is an anti-fraud tool that can help online merchants strengthen payment security.
CNBC reports a boom in credit card fraud during Covid-19. There are few regulations to protect small businesses from chargebacks caused by fraudulent transactions.
What are Chargebacks?
Customers inaccurately claiming they didn’t receive their purchase is the number one cause of fraudulent chargebacks. Unfortunately, this is especially true with ecommerce transactions.
The responsibility of protecting their company from chargebacks ends up falling on the business owner’s shoulders. Fortunately, companies such as Mastercard and Visa are hard at work on fraud prevention solutions.
Mastercard SecureCode attempts to combat credit card fraud. It protects participating merchants from chargebacks through an enhanced verification process and requires issuing banks to authenticate shoppers at checkout.
So, what can Mastercard SecureCode do for your small business? How does it work? And how can you implement it?
Let’s get into the nitty gritty.
What is Mastercard SecureCode?
Mastercard SecureCode is a free fraud prevention service. It creates an added layer of security for small businesses by reducing the chargeback risk when consumers make an online purchase.
The added security comes from shifting liability from the merchant to the card issuer. It reduces “cardholder unauthorized” or “cardholder not recognized” transactions by requiring customers to enter a private code at checkout.
It’s the customers’ responsibility to keep their SecureCode safe to prevent unauthorized use of their credit card or debit card. It makes customer accounts harder to hack, and merchants have less liability for unauthorized use.
How Does Mastercard SecureCode Work?
The process is simple. Customers see the Mastercard SecureCode logo on a merchant’s website or wrap stand.
Once they choose the SecureCode option, they are greeted with a unique personalized message. If it’s the right message, they simply type in their Mastercard SecureCode to provide the necessary authentication.
The Mastercard SecureCode is unlike a traditional PIN number. When customers are online shopping, it gives merchants added protection on each transaction.
That’s because customers bypass sharing their authentication code with the retailer. Instead, they send it directly to their issuing bank for confirmation.
How Does it Benefit Shoppers?
The biggest benefit for consumers using Mastercard SecureCode is the reduced risk of fraud. Say a hacker uses a credit card skimming device to steal a customer’s card number at the gas station.
They can then use that card at any business that doesn’t require the customer to enter their CVV number at checkout. Even checkouts that do require CVV numbers can be penetrated by email hackers or shady salespeople.
Mastercard SecureCode adds 3D security to the online checkout process. Since merchants never see shoppers’ SecureCode, they can buy from stores without worrying that anyone will swipe their data.
Guaranteed ecommerce payments increase trust between merchant and shopper. Customers can shop with any online retailer they want, with another layer of built-in security.
How Should Cardholders Enroll for Mastercard SecureCode?
Enrollment is a pretty hassle-free process. Cardholders can add Mastercard SecureCode to any Mastercard, such as Maestro, at the link provided to bypass their issuing bank.
By signing up to add SecureCode, customers will receive added protection on their card transactions from that point on. They don’t need to be issued a new card.
Once customers are signed up, they will be prompted to enter their one-time SecureCode via SMS. If the greeting they receive in the pop-up window is wrong, they’ll know not to process the transaction.
Mastercard customers can also sign up to add SecureCode to their cards from participating financial institutions. Customers just have to call their issuing bank to see if they offer the service.
What Benefits Does it Offer Businesses?
The biggest benefit for businesses that use Mastercard SecureCode service is protection against chargebacks from fraud. It is harder for customers to claim they never ordered a product if they authenticated with their personal code.
But that’s not the only benefit of using Mastercard SecureCode. It can also help small business owners:
Reduce their interchange fees – if the business qualifies for less expensive SecureCode rates
Give more purchasing confidence – new and existing customers gain an added layer of payment security.
Enable business expansion internationally – international customers can use their Maestro card to make purchases once SecureCode is implemented.
Meet customer expectations – as SecureCode is widely rolled out, customers will expect legitimate merchants to offer it as an option.
Businesses have never been more at risk of fraud and hackers. 3D security supplies an added layer of protection against shady goings-on, so the company is protected… no matter what.
How To Set It Up and Offer It To Your Customers?
Are you ready to implement Mastercard SecureCode in your business? If so, you’ll first need to contact your credit card processor to make sure they support the service.
Ask your payment processor if they support 3D security applications, such as Mastercard SecureCode. If the answer is “yes,” you’ll sign up on Mastercard’s website to receive a SecureCode plugin.
Contact your payment processor to test your website once it’s installed… and voila! You have added protection against chargebacks for online transactions.
Some FAQs about Mastercard SecureCode
3D payment security can be complex at first glance. Still have questions? Let’s review some of the most common merchant FAQs about Mastercard SecureCode.
How will customers process SecureCode transactions on my site?
Customers who are enrolled in SecureCode will automatically be prompted to enter the code if your website supports SecureCode transactions.
Can customers only use SecureCode with Mastercard?
No, but customers need to have an account with MasterCard to use the service on any of their cards.
How do I let customers know they can use SecureCode?
Mastercard offers free graphics that you can upload to your website to let customers know you’re a participating retailer.
Can customers use SecureCode if I haven’t signed up for it?
Customers won’t be prompted to enter the code, but they will still receive some enhanced security benefits.
How many cards can customers register with SecureCode?
There’s no limit.
There’s no reason to accept damage to your business from friendly fraud. 3D security technologies, such as Mastercard SecureCode, help merchants like you save on chargebacks, prevent fraud, and build customer trust. It’s worth the effort of getting signed up, as it may soon be as influential as PayPal and other third party secure payment technologies.