Verified by Visa: What It Is and Should Merchants Use It?
Any merchant with an e-commerce business will have most definitely heard about Verified by Visa by now. It’s been around for almost two decades, so it’s not exactly new. That said, adoption of the technology — at least in the beginning — was slow and many merchants hesitant to add extra steps to their checkout processes.
Today, however, online security has become a much more prominent part of the conversation. As such, the time for merchants to re-address anti-fraud solutions like Verified by Visa is now.
In this article, we will guide you through the ins and out of the Verified by Visa. We will cover what it is, how it works, what benefits it can offer, and how to get set up.
If you are a business taking payments online, we strongly advise that you take the time to read the information below to learn what it is and decide for yourself whether or not it is worthwhile for your business and your customers.
What is Verified by Visa?
Verified by Visa is a mechanism designed by Visa to add an extra layer of security to online transactions in an effort to prevent fraud. Visa’s objective is to give merchants an option to better protect their customer’s security online.
The solution is referred to as a 3D Secure fraud prevention tool. Why “3”? Because three parties are required to be involved in the authentication process. They include:
- the merchant,
- the acquiring bank (whichever bank the consumer is with)
- the card network (Visa).
For merchants already familiar with 3D Secure solutions from other card networks, you may notice that Visa’s 3D Secure advanced anti-fraud platform works in a very similar way. This is because the same principles are implemented in Visa’s solution as they are of the highest standard in the industry for 3DS protocol.
How does Verified by Visa work?
The payment process that most merchants have for their online platforms looks much the same: the customer selects their items, confirm amounts, enters credit card details, and hits confirm.
Verified by Visa works by implementing an additional level of verification to the above process. More on this below.
Version 1.0 vs. Version 2.0
With version 1.0, when the customer hits “confirm” to go through with their purchase, they are taken to a Verified by Visa page and asked for a passcode, which they would have set up through their bank, to prove that they are the valid cardholder.
With version 2.0., the authentication mostly happens behind the scenes, or in some instances, the consumer may be given a simple challenge, like filling in a one-time password which was sent to their phone.
Verified by Visa 3D Secure 1.0
When Version 1.0 first came out, it faced a lot of resistance. It required users to have password authentication to complete any online purchase with Verified by Visa, but consumers had to sign up for their Verified by Visa password before they could use it. Unfortunately, the password set up was problematic; it could not be done on the spot, and with some banks, it took a few hours to go into effect.
Version 1.0 also used a pop-up window that took customers to another page to fill in their password. This made some consumers fear that they were being tricked and in many cases, the pop-up page did not work effectively on mobile browsers or with users who had blocked pop-up windows.
It is Version 1.0 that has caused many to ask whether Verified by Visa is legit. To make things worse, scammers began sending out emails pretending to be from Verified by Visa, to try and get consumers to enter their credit card details and their password for authentication. There were many signs that these emails were not legit, the major one being that no card company would ever ask for this information via email, but consumers can be unaware of these threats, and some do fall victim.
Verified by Visa 3D Secure 2.0
In 2017, Visa released Verified by Visa 3D Secure 2.0. This version removed the most significant barrier for consumers, the sign-up process. It also replaced the static passwords by introducing token-based and biometric authentication methods, eliminating the risk of scammers getting their hands on the authentication password.
By linking mobile apps, chip cards, and other electronic methods of payment, version 2.0 offers a more streamlined user experience for the customer, which is undeniably a big win for the merchant — no more abandoned purchases due to clunky processes. Version 2.0 means that safety and convenience are able to go hand in hand.
Version 2.0 is also far more mobile-friendly than its predecessor, with mobile authentication that allows for seamless integration across mobile devices and payment platforms.
Lastly, the improved integration of 2.0 improves the risk-based decisions for payment processors and improves customer recognition with every transaction. It is this that allows Verified by Visa 2.0 to skip the authentication challenge with some customers, enabling this process to instead happen in the background, verifying their identity without requiring additional information from the customer.
So, is Verified by Visa safe?
Yes. Both versions of Verified by Visa are safe for merchants and consumers alike. If consumers are using version 1.0, they need to be aware of the risks of sharing their password and that scammers are out there, but the system itself is 100% safe, as long as users are careful with their information. Version 2 eliminates this concern.
What to Consider When Implementing Verified by Visa?
Verified by Visa is for any business that operates online. Whether it’s entirely online or online and through a brick and mortar store does not matter as Verified by Visa is only added to the online purchase process.
For every merchant, whether you already support version 1.0 or not, Visa recommends supporting both the 1.0 and 2.0 specifications. Supporting both versions means that users can decide which authentication method they prefer. This makes merchants appear more accommodating in the eyes of their customers and reduces the friction from consumers who may have preferred version 1.0.
Verified by Visa Merchant Benefits
The benefits of Verified by Visa, as presented are :
- It adds an extra layer of security for online transactions
- It increases consumers confidence in the safety of the merchants’ online store
- It can reduce chargebacks by catching fraudulent transactions before they are authorized
- It shifts liability for fraudulent transactions from the merchant to the issuer.
When adopting any new technology, there are always going to be some customers that don’t like the process and may abandon their cart. While this is a valid consideration, the process is now a relatively common practice that consumers will get used to it, and the increase in consumer confidence should boost sales to minimize the impact of any drop-off.
Verified by Visa Costs
As a card network that wants to reduce the fraud taking place on their cards, it is in Visa’s interests to offer these solutions to their customers for free. Therefore, most merchants will be able to go straight ahead with implementation without incurring any costs.
In some cases, there may be fees or charges in the event the merchant needs to purchase and install plugins to enable Verified by Visa on the site, but this is the only costs that merchants could come up against.
Merchants are advised to contact their processor to check whether or not Verified by Visa enablement is part of their processing services. They will be able to inform on what costs may be needed to set up Verified by Visa.
How Do You Register for Verified by Visa?
Merchants with an existing Visa Online account can log on to find the Verified by Visa implementation guide for merchants and acquirers, which covers:
- 3D Secure 2.0 processing flows
- how to get started, program rules
- everything else you need to know about getting set up.
Merchants who do not currently have a Visa Online account will need to speak with their acquirer or Visa account executive to get an account and learn about how to register for Verified by Visa.
To implement 3D Secure 2.0, merchants’ 3D Secure Server and issuers’ Access Control Server software needs to support the updated 3D Secure 2.0 specifications. Providers of merchant 3D Secure Server software will, in most cases, manage the initiation of the authentication requests, according to the 3D Secure version (1.0 or 2.0) supported by the issuer.
As a free solution that reduces fraud, protects customers, merchants, and issuers, there is very little reason why merchants should not implement Verified by Visa.