Strong Customer Authentication (SCA) will have a major impact on subscription businesses collecting online payments using cards. GoCardless can help your business navigate through these new payment rules and keep your subscriptions running smoothly.
In September 2019, Strong Customer Authentication will come into force in Europe. SCA is a new form of two-factor authentication designed to add an extra layer of security when your customers make a payment online. Although SCA is being implemented to reduce fraud, it will also have a significant impact on website conversion rates by complicating the checkout procedure.
1 in 5 online purchases are likely to fail due to increased complexity in the checkout process.
European businesses stand to lose an estimated €57 billion revenue in the first year after SCA implementation.
SCA compliance will require product, legal, operations and finance teams to implement large-scale changes to processes.
“We’re delighted to be working with GoCardless to offer Bank Debit as a payment option throughout the UK and Europe, to ensure customers are able to complete quick and easy transactions with DocuSign.”
Robin Joy, SVP of Digital, Demand & Web Sales, DocuSign
Until now, customers have been able to simply enter their payment details online and complete their purchase. However, SCA will now require two-factor authentication for a large number of online payments. Under the new rules the payment process will look something like this:
GoCardless is fully PSD2 compliant, and paperless Direct Debit mandates used by GoCardless are out of scope for SCA. You’ll be able to collect all your recurring payments with absolutely no additional two-factor authentication required.
GoCardless offers smarter online payments, free from the hassle of arduous two-factor authentication.
Avoiding customer friction at checkout will allow you to prevent a drop in conversion when SCA comes into force.
Paperless Direct Debit mandates used by GoCardless are out of scope for SCA.
56% of consumers said they were likely to pay for a subscription by Direct Debit to avoid a longer checkout.Research conducted by GoCardless, security vs convenience in the payment experience, June 2019
* Ravelin, "Ravelin data reveals one in five payments are lost through 3D Secure"
**451 Research, "The Impact of SCA: Shaking up Europe's online economy"
Help & resources
GoCardless (company registration number 07495895) is authorised by the Financial Conduct Authority under the Payment Services Regulations 2017, registration number 597190, for the provision of payment services.
GoCardless SAS, an affiliate of GoCardless Ltd (company registration number 834 422 180, R.C.S. PARIS), is authorised by the ACPR (French Prudential Supervision and Resolution Authority), Bank Code (CIB) 17118, for the provision of payment services.