What does Strong Customer Authentication mean for accepting card payments?

Improving customer safety when making electronic payments is a major focus not just in the UK, but around the world.

Team of mechanics standing outside their premises

In the EU and the UK, this is being introduced in the form of Strong Customer Authentication (SCA), which aims to add additional layers of security and protect customers.


But, what exactly is SCA, how will it protect customers and what does it mean for vendors?


That’s what we’ll discuss in this article.

What is Strong Customer Authentication?


Strong Customer Authentication forms part of the EU’s second Payment Services Directive (PSD2) which will improve customer safety by adding additional security measures onto electronic payments.


Although this is an EU directive, it will be adopted by the UK.


SCA requires banks to make extra checks when an electronic payment is made to confirm the customer’s identification, ensuring it’s them trying to pay.


As part of the checks, customers could be asked to provide a number of forms of identification during checkout, which could include a combination of:

  • A password or PIN number
  • A one-time passcode on a mobile device
  • Biometric data like a fingerprint or facial recognition

Mac Tools a Handepay customer holding Handepay Card Machine

What does this mean for payments?


From a business perspective you should upgrade your card payment machine if required to ensure payments can be compliant with SCA.


This already happens instore when customers will be asked to confirm their PIN number on occasion when trying to make contactless payments.

The main changes will likely be when customers are making online payments, as these ‘card not present’ transactions are deemed to be the most risky for customers.


This is because the customer and their card aren’t present when they pay.


As part of the upgraded security, you should ensure your website incorporates 3D Secure.


3D Secure automatically asks customers to complete an additional verification step when buying online, and ensures you as the vendor remain compliant with SCA.


It also ensures transactions remain easy and smooth for customers while adding the additional security you need.


If the customer is unable to pass the additional security checks, the payment may be declined.


3D Secure also moves the liability for fraudulent or disputed payments away from you as the vendor, and onto the card issuer, meaning you won’t have to worry about losing payments that turn out to be fraudulent.


If a 3D secure payment goes through and is then later disputed by the customer, the dispute will be handled by the card issuer and totally dealt with on their end - so you don’t have to worry about it because you’ve completed all the stages you had to.

Handepay Card Payment Terminal

Keeping your business and payments secure

As a business you have a responsibility to provide an environment for your customers to make payments in a way that’s not only easy and convenient, but safe and secure.


Strong Customer Authentication and new safety measures like 3D Secure not only provide confidence to your customers that you take their security seriously, but can also protect your own business from problems with disputed payments and potential fines when it comes to data security.

Financial disclaimer:

Terminal hire contracts are provided by Merchant Rentals Limited, who is authorised and regulated in the UK by the Financial Conduct Authority (FCA) for Consumer Hire under FRN 720500. Terminal hire can be for consumer hire and non-regulated hire contracts. Please check your contract carefully for details. Regulation of all consumer hire fall under the control of the FCA.

Handepay Ltd is authorised and regulated by the FCA for Consumer Credit under FRN 673564. Handepay is a credit broker for consumer hire not a lender.

Handepay acts as an introducer of card acquiring services on behalf of EVO Payments UK, the card acquiring service provider. EVO Payments UK is the trading name of EVO Payments UK Ltd, a payment institution that is authorised and regulated by the Financial Conduct Authority (FRN number 959332).

Existing Cards Businesses- The one-month rolling terminal hire contract from Merchant Rentals is only available to businesses that are switching from their current acquirer to EVO Payments UK arranged through Handepay.

New to Cards Businesses- The 12-month terminal hire contract from Merchant Rentals is only available to businesses that are new to card payments and wish to receive acquiring services from EVO Payments UK, arranged through Handepay.

The Next Day Banking Settlement service provided by EVO Payments UK incurs an additional fee of £4 a month on top of your acquiring service charges and fees. Provided your card machine performs a reconciliation before 12am (midnight), you’ll receive settlement of funds the next banking day.

Editorial disclaimer:

The information we provide does not constitute financial advice and might not apply to your business. Always carry out research into your business’ needs when choosing a new merchant services provider.

Sometimes, we link to other third-party websites to provide you with additional information. At the time of publication, we consider the information accurate, however, we do not have control over their content and are not responsible if any information on these websites change.

The products we display on our website are for illustrative purposes only - if your business requires additional facilities, you may receive a different model than advertised.

All of the information contained on this website, including fees, services and functionality, are correct at time of publishing. E&OE.