SMS Over the past few days, the internet has been awash with articles and press releases announcing the planned demise of the payment validation system. As a participant in this debate, we felt it was our duty to provide an update. SMS Disappearance of the OTP what’s really going on?
The facts
SMS SMS ” Online payment: the disappearance of the set for 2020″, hammers Les Echos . “Online payment: the anti-fraud system is not dead yet”, moderates La Tribune. The association Marketing Mobile France, quoted by the Journal du Net, argues that it would be difficult to do without this “popular and universal channel” in such a short space of time. “popular and universal channel”.
Widely used by banks and retailers, SMS authentication is considered unreliable and inefficient for complex transactions.
The challenges of DSP2
The European Payment Services Directive 2nd version officially came into force on 13 January 2019. Transposed by order into French law, it includes several parts introducing new rules . The latter are sms services mainly of interest to consumers. Therefore, in particular the requirement for strong authentication for online payments of more than 30 euros in order to reduce fraud in e-commerce .
In order to increase the security of our transactions, the text imposes 3 authentication factors. First SMS Online Payments factor: a code that I know, then a device that I own and finally a personal characteristic of the customer. SMS However, it combines only two of these factors.
“Cheaper, safer and more innovative payment services” . This is the promise of the new directive.
The latter, unlike the other provisions, entered into force on 14 September 2019 .
SMS OTP Should Survive PSD2, Just for a Little While
Consumers can rest assured that the implementation of the “strong authentication” requirement has been largely postponed. A large number of European countries, including France, have already announced that they buy country wise email marketing list are giving banks, technical service providers and merchants additional time to comply.
Before throwing stones, it should be noted that the strong authentication method (3D Secure) used today has largely proven its value in the fight against fraud in these payments. The fraud rate for authenticated fans data transactions is much lower than that of unauthenticated transactions: 0.07% versus 0.21% . Therefore, according to data from the Observatory of Payment Methods (OSMP). In concrete terms, there was 1 euro of fraud for every 578 euros of online payments (an average fraud rate of 0.173%) .
