Eit’s annoying. After intensive research on the Internet, you have finally found what you want to buy, enter your address and want to pay by credit card – and then the transaction is canceled or the customer cancels it himself. The shopping tour is over.
About 20 percent of purchases on the Internet fail when paying with a credit card. This is usually due to security procedures. A current survey by the Bundesbank confirms this. According to this, seven percent of those surveyed “frequently” break off their online purchases because of the security questions, and another five percent “about half of the purchases”. Another 24 percent stop the transaction at least occasionally (“rarely”). Women drop out about twice as often as men, younger people between the ages of 25 and 34 the most, and those who are younger the least. Interestingly, the numbers are no less for savvy internet shoppers who shop online several times a month. Two thirds of those surveyed shop at least once a month, which is 28 percentage points more than in 2017. The corona lockdowns have left their mark here.
And yet the security procedures are a hurdle. Last year they were tightened to increase security. Since then, two-factor authentication has been used for credit card payments on the Internet, which means that two security steps are required to approve a transaction. The first step is usually to install an authorization app from the house bank on your own cell phone with a connection to your own bank account. The second step is then to access the app with a code, fingerprint or face recognition and then click or fingerprint or PIN to approve the purchase in the app. In the past, only one step was necessary.
The reasons why the new procedure does not work smoothly can be quite banal. “In half of the cases, purchases fail because the customers have not even registered with their bank for the necessary security procedure,” says Carsten Mürl, a specialist in security solutions at the credit card provider Mastercard Germany, who observes the transaction behavior of users. In most cases, the missing registration is displayed to the customer with the message: “You are not registered for 3-D Secure. Contact your bank.” 3-D Secure is the technical term for secure payment processing between customer, retailer and bank (3-D). Sometimes the transaction simply breaks off without this notice.
What users are doing wrong
In the other half of the terminations, Mürl believes that the users are doing something wrong when approving the purchase, or the process is taking too long or is incomprehensible. For example, many retailers do not automatically forward to the customer’s bank’s authorization app during the payment process. They ignore the notice that in this case they have to go to this bank app themselves to approve the purchase. Then some customers give up. In order to avoid this termination, Mastercard, for example, recommended that merchants should set up forwarding to the bank app, and banks must automatically switch from their approval app back to the merchant app by October 2022. Mürl fears that implementation could still be delayed by a few months into next year. Another hurdle is that there are often two different apps for normal banking transactions and for credit card payments. But more and more banks are integrating both into one authentication app.
Problems often arise, says Mürl, when a separate PIN is required for credit card payments, an ePIN. This differs from the normal PIN for online banking. Because it is used less often, some customers have forgotten it. Sometimes the sending of a one-time password, which must be entered for authorization, to the cell phone via SMS fails because an old, expired cell phone number is stored at the bank. So the delivery comes to nothing and the online purchase fails.
It also becomes impossible if you make a purchase using your smartphone, but a photo TAN (a dot pattern on the screen) has to be read in with the device for the purchase. This would require a second device. Alternatively, you could then switch the security procedure to TAN via SMS, but this is considered less secure and some banks no longer offer it.
Improvements are planned
Hope for fewer aborted purchases offers more precise information from banks and retailers during the payment process. But also new user-friendly procedures. In other European countries, some banks use “behavioural biometrics”. The way in which the customer enters the one-time password via SMS is analyzed. For example, whether he enters the one-time password just as quickly as usual and holds his cell phone with him as usual. A repeat entry or an ePIN would only be required if there were any deviations from normal behavior. Normally, the customer then saves a security step.
In the future, the industry solution “Click to Pay” should make things easier. “That should significantly reduce the number of cancellations,” hopes Volker Koppe from the credit card company Visa. The consumer can allow the card companies to pass on card information to retailers if a retailer requests it because the consumer is a customer there but has not created a customer account. The customer will then see their credit or debit card when paying and only has to click on it. There is no need to repeatedly enter the card data, and typing errors are avoided. Depending on the type and amount of the transaction, however, authentication of the cardholder will still be required.
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