Designed to add additional layers of security for online credit and debit card transactions, 3-D Secure has proven to be extremely useful in thwarting potential fraud. 3-D has been adopted by credit card giants Visa (Verified by Visa), MasterCard (MasterCard SecureCode), and American Express (American Express SafeKey) among others and the software technology behind 3-D is constantly improving.

Case in point: Silicon Valley-based Simility, who recently launched their Adaptive 3-D Secure solution. Their system leverages advanced machine learning to flag only the riskiest online transactions. Additionally, Simility’s non-intrusive security solution remedies a common problem existing in many 3-D applications where blocking fraud is actually harmful in the purchase and transaction process by adding friction to the checkout process. That friction can ultimately lead to lost sales, according to Simility CEO, Rahul Pangam.

“3-D Secure is a very reliable way to block online fraud, but it challenged too many (legitimate) transactions, which is a bad idea and leads to a lot of checkout friction and cart abandonment,” said Pangam in an interview last week with CardNotPresent.

How did the original 3-D Secure technology work? Card issuers authenticated online shoppers before they were authorized to complete an online transaction. Since the card issuer authenticated the user, liability for fraud rested with the bank rather than the merchant. In earlier iterations, this technology asked users to authenticate themselves with a password for every transaction. Unfortunately, merchant adoption was low despite the shift in liability.

Fortunately, Simility’s solution pinpoints only high-risk transactions, so instead of checking hundreds of potentially suspicious online purchases, merchants only need to invoke additional security on about 10% percent of them.


As ecommerce quickly shifts to mobile, new solutions will be needed to combat growing fraud threats and tools like Adaptive 3-D Secure are leading the way. National Merchants Association is proud to partner with some of the most advanced fraud-busting tools in the world of payment processing to ensure safe and profitable businesses. Contact us today for more information!