It is in everyone’s best interest, be it a consumer, merchant, acquirer or issuer,to reduce friction caused by SCA through exemptions, in order to keep theshopping experience as frictionless as possible, while keeping fraud at bay. Amongthe most important thing you need to know about exemptions as a merchant is that most exemptions are at the issuer’s discretion, and there are some that are based on the acquirer’s performance. This means that if a merchant requests an exemption, it possible that the issuer may not agree and may go ahead with SCA to ensure fraud does not occur. Other exemptions, such as transaction risk analysis, depend on the acquirer’s or issuer’s overall fraud rate
The Visa Delegated Authentication program is the PSD2 regulation that allows anissuer to ‘delegate authority’ for SCA to a third-party (such as a walletprovider, merchant). The Delegated Authentication program enables merchants whoqualify and have an SCA compliant solution to perform SCA on behalf of theissuer or accept recently performed SCA under certain conditions with the aim of reducing checkout friction. Remember that each network has different program rules for support of DA, and it is recommended for merchants to work with their acquirer or network contact for qualifying factors.
If you are a merchant who supports authentication solutions for your consumer accounts or profiles, you can apply for these programs. Merchants that havebuilt savvy and SCA compliant authentication programs into their consumeraccount profiles can use this program to reduce consumer friction during checkout. Both merchants and issuers can use Cardinal’s rules engine to set rules to manage these exemptions to quantify exemption requests not to evoke SCA, to force SCA on an EMV 3DS transaction, and to route transactions properly via supported 3DS protocols.
For more in information on the Visa Delegated Authentication program, visit our website at https://loginid.io/
