Reduce False Declines & Stop CNP Fraud with EMV …...Consumers Stop Shopping with that Retailer2 3x...

January 24th, 2019

Reduce False Declines & Stop CNP Fraud with EMV 3DS and Behavioral Biometrics

AUTHENTICATION WEBINAR SERIES

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Today’s Speakers

Manager, North America Product Management,

Mastercard

Vince Wong

VP, NuData Security a Mastercard Company

Ryan Wilk

Director, Global, Product Management,

Mastercard

Valerie Matusiak

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q Market Landscape: Card-Not-Present Fraud & False Declines

q Overview of EMV 3-D Secure

q How Merchants Can Participate in EMV 3-D Secure

q Dual Defense Method to Reduce False Declines

q Mastercard’s Smart Interface Four-Fold Value Proposition

q Data Only Transactions Benefit

q Question & Answer Period (~15 mins)

Agenda

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Current Card-Not-Present Landscape

45.3

6.5 6.9 7.2

2016 2017 2018 2019 2020

Online Card Fraud to Rise to USD 7.2bn by 2020 1

97

82

70 75 80 85 90 95 100

Physical

Digital

Global Approval Rates (%) 1

1. US Payment Forum, Card-Not-Present Fraud Analysis 2017.

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False Declines Landscape

False Declines for Payment Card Transactions

Totaled$303 billion in

20171

$303 Billion 32%

32% of Falsely DeclinedConsumers Stop

Shopping with that Retailer2

3x

False Positive Decline Rate is

Over 3 times the Rate of Existing

Card Fraud3

1. US Payment Forum, Card-Not-Present Fraud Analysis 20172.JAVELIN STUDY 20183.JAVELIN 2014 STUDY.

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Payment AuthenticationEMV 3-D Secure

(3DS 2.0)

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EMV3DS“ 3DS 2.0 ”

A new industry standard used to check a consumer’s identity on digital payment transactions

What is EMV 3-D Secure (3DS 2.0)?

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3DS 1.0 Standards

3DS 2.0Standards

AUTHENTICATION METHOD

Static passwords & security questions Eliminates static passwords

INTERFACES Browser dependent Supports different payment channels

DATA Only 15 data elements available Enables 10X more data to be exchanged

USE CASES Supports guest check-out only Supports guest checkout with additional use cases

DECISIONING Merchants bound by issuer decisioning Enhances decisioning

3DS 2.0 Facilitates Frictionless Authentication

Global Activation: November 6th, 2018

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Acquirer BIN

Acquirer Merchant ID

Cardholder Account Number

DS URL

Message, Extension, Version

Acquirer BIN

Acquirer Merchant ID

Card Expiry Date

Cardholder Account Number

DS URL

Merchant Country Code

Message Category, Extension, Type, Version

Purchase Amount, Currency, Date & Time

Recurring Expiry, Frequency

More than 10 X Data

Browser User-Agent

Browser User-Agent

IP address

Browser Time Zone

Cardholder Email Address, Home Phone Number, Mobile Phone Number, Work Phone Number

Cardholder Name

SDK App ID, SDK Encrypted Data, Ephemeral Public Key

SDK Reference Number, SDK Transaction ID

3DS Requestor URL

Browser Accept Headers

Cardholder Account Information (Account Age,

Change, Password Change, Number of Transactions per Day /

Year, Shipping Name Indicator, Suspicious Activity, Payment

Account Age etc.)

Cardholder Account Identifier, Billing Address

Cardholder Shipping Address

Transaction Type

Account Type

Browser Time Zone

DS Reference Number, Transaction ID

EMV Payment Token Indicator

Purchase Date & Time

Recurring Expiry, Frequency

3DS Server Reference Number, Operator ID, Transaction ID, URL

Address Match Indicator

Device Channel, Device Information, Rendering Options

Supported

Message Category, Type

Merchant Name

Merchant Country Code

Merchant Category Code

Merchant Risk Indicator (Delivery Timeframe, Re-order, Pre-order, Gift Card)

3DS Requestor Authentication Information (Method), Challenge Indicator, ID, Initiated Indicator

3DS Requestor Name, Non-payment Indicator, Prior Transaction Authentication information

Instalment Payment Data

Browser Java Enabled, Language, Screen Color Depth, Height, Width

3DS 1.0 Data 3DS 2.0 Data

3DS 2.0 Provides 10x More Data for Accurate Authentication

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Global Results

+11%Increase in approvals

when transactions are fully authenticated1

Increase Approvals

<8BPSLower digital fraud when dynamic authentication

is used2

Reduce Fraud

1. MASTERCARD. Q1 - Q3 2016 DATA, ACROSS ALL CARD TYPES. 2016. 2. MASTERCARD. SECURECODE CARDHOLDER VERIFICATION METHOD (CVM) FRAUD STUDY. 2013.

*Contact your Mastercard representative to engage in a quantification effort specific to your business.

What are the results we have seen with 3DS?

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Merchants Participate in 3DS 2.0 Through a 3DS Server

Merchant Issuer

Access Control Server

Directory Server

3DS Server & Client

Digital Transaction

Insights

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Mastercard’sSmart Interface

(network-agnostic)

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Behavioral Biometrics on Checkout Page

Dual-Defense Method to Reduce False Declines

Pre-Payment Authentication

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Dual-Defense Method to Reduce False Declines

Payment Authentication with EMV 3-D Secure

+ EMV 3-D Secure

Pre-Payment Authentication

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Funnels out Automated Attacks

Leverages NuData’s Expansive Trust Consortium

Analyzes Behavioral Data to Identify Bad Actors

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Payment Authentication with EMV 3-D Secure

Funnels out Automated Attacks

Leverages NuData’s Expansive Trust Consortium

Analyzes Behavioral Data to Identify Bad Actors

Increase Approvals

Reduce False Declines

Decrease CNP Fraud

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Smart Interface(network-agnostic)

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Leverage Behavioral Biometrics at

Checkout

Value #1

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Checkout

Value #1

Connect to EMV 3-D Secure to Reduce CNP

Fraud & Increase Approvals

Value #2

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Checkout

Value #1



Value #2

Rules Engine Tailored to Enhance Decisioning &

Manage Compliance with Global Regulations

Value #3

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Checkout

Value #1



Value #2

Rules Engine Tailored to Enhance Decisioning &

Manage Compliance with Global Regulations

Value #3

Intelligently Populate Optional Data Fields in

Authentication Requests

Value #4

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250 Million Automated Attacks Mitigated

99%Accuracy in Bot Detection

700 BillionBehavioral Events in Trust Consortium

2.5 BillionDevices in Trust Consortium

NuData Security on Checkout PageValue #1

$500 millionSaved in December by merchants using NuData

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Merchant Issuer


Directory Server

Smart Interface

Digital Transaction

Insights

Connect to 3DSValue #2

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Easily Manage Industry Regulations with Advanced Rules Engine Value #3

NuData Analytics Dashboard & Rules Engine

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Easily Manage Industry Regulations with Advanced Rules Engine Value #3

Manage PSD2 Regulations with Rules Engine

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Intelligently Populate Optional Data Fields in Authentication RequestValue #4

Smart Interface

Authentication Request

Optional Fields

41 Required Fields

• Suspicious Account Activity• Number of Transactions per

Day• Number of Transactions Per

Year• Cardholder Account

Purchase Count

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Mastercard Value Add: Data Only

Merchant Issuer


Directory Server

Smart Interface

Digital Transaction

Insights

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18. Q4 19.Q1 19.Q2 19.Q3 19.Q4

2018 2019

December MASTERCARDIdentity Check Program Compliance (All)

NovemberMASTERCARDIdentity Check / 3DS 2.0Activation (All)

NovemberAMEX SafeKeyLaunch

Network Timelines for EMV 3-D Secure

April VISA 3DS 2.0 Liability Shift

December MASTERCARD Early Adopter Program concludes

NovemberDISCOVER Protect Buy 2.1 Launch

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How will Smart Interface

Help Merchants Reduce False

Declines & Increase Approvals?

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AUTHENTICATION WEBINAR SERIES

Thank You! Please contact Vince for any additional information

Webinar Recording & Deck will be Sent Out to All Participants

[email protected]

Vince Wong

Reduce False Declines & Stop CNP Fraud with EMV …...Consumers Stop Shopping with that Retailer2 3x...

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Transcript of Reduce False Declines & Stop CNP Fraud with EMV …...Consumers Stop Shopping with that Retailer2 3x...