Payment methods are of major importance in the world of e-commerce. Today we are going to focus on the means of payment online, that is to say, those where all operations are carried out in a telemetric way. They are the tools with which money is transferred from the buyer to the seller and, therefore, hosts the most critical phase of an online store. Every owner of an e-commerce needs to have their means of payment under control and for this, he needs to know how they work.
Simply and without entering into technicalities, we could define an online payment method as a tool that allows customers to receive payments, in advance and immediately after the buyer confirms their purchase. The money goes from the buyer to the seller, passing through the payment gateway who regulates and authorizes the flow.
If you allow me the simple, the action of paying in a method of payment could be compared to a telephone call. The buyer enters his data to pay for the product or service that interests him, then a call is generated with a communication with the payment gateway (from our bank, PayPal, Stripe, etc) and if accepted by the buyer, the Request and the money is immediately transferred to our account.
Payment method security levels
There are different levels of security in online payment methods, which bring together so many Virtual Point of Sale ( POS ) that are granted by banks or means of payment that do not depend on any bank, such as Stripe, PayPal or similar.
The security levels of the payment method are three: known as a safe mode or 3D Secure, mixed mode or normal mode or without 3D Secure.
Secure Level or 3D Secure
The vast majority of banking entities automatically grant the self-employed and SMBs a Virtual POS with security level 3D Secure to be able to receive payments in their e-commerce. This level of security forces all purchases to be made by cards with the 3D Secure protocol. If you already have an online store and you do not know what kind of Virtual POS will surely have this type :).
All cards are composed of 16 digits and have an expiration date and a visual cryptogram ( CVV ) that are three-digit control to verify the transaction. However, after entering this data, on 3D Secure cards, we will be directed to the bank website corresponding to our card and we will be asked for an additional password as a security measure.
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The goal of this level of security is to reduce problems with fraudulent cards and provide security to customers in their payments. The handicap found by owners of online stores is that, although almost all cards are 3D Secure, many of them are not enabled for online purchase and fail at the time of purchase in the store. Cards are delivered disabled when they are created or renewed and require an initial activation with the bank.
To enable a card with 3D Secure and that is available for purchase online in a Virtual POS with a level of security 3D Secure, you just have to contact the bank to enable this option. The problem is that there are many buyers who, despite being living a revolution in payment methods, are still not adapted to this technology.
The level of security mixed is one of the most interesting because it combines the same features of 3D Secure mode, but from a certain amount of money that we can set as owners of e-commerce. It is a more flexible tool that allows accepting payments of all types of cards up to a maximum of fixed money. From this amount, the operation is exactly the same as the safe level.
For example, we can offer a mixed security Virtual POS in our online store. Let’s take the case that we sell sunglasses that have a price of 30 Dollars a unit and we have fixed that all orders over 200 Dollars have the level not safe. In all orders up to 200 Dollars will accept all types of cards, but in the higher than 200 Dollars will enter the game 3D Secure.
With this method, it is possible to reduce the number of abandonment rate or interrupted orders (the big drawback of 3D Secure) at the moment of making the payment in our store and we can receive the money of those cards that do not have 3D Secure.
This action poses a certain risk to possible problems of fraudulent cards since it would be the owner of the store responsible for this amount. However, it should be noted that, although on a residual basis and on very few occasions, fraudulent card problems may also exist at the safe level.
Normal mode or without 3D Secure
This level of security is the one that accepts the cards, whether or not they have a 3D Secure security level. This is the method of payment with fewer restrictions and validations within the Virtual POS. It is usually configured in large companies with a significant volume of business and is willing to take risks in terms of fraudulent payments and problems with card fakes that we will now understand with these legal differences.
Legal differences between security levels
Like everything in this life, all options have their advantages and disadvantages. In my view, the mixed level is the most interesting because it has the advantages of the two extremes and behaves differently depending on the money of the purchase.
If we make a purchase online with a card without 3D Secure, neither the PIN nor the digital signature is checked. This means that it would be possible to reject the payment so that the payment will reimburse us the money. In this case, the responsibility lies with the bank that has granted the Virtual POS to e-commerce, which will be affected by the bank’s claim of the buyer’s card. For this reason, all operations promoted by banks with virtual POS terminals are “forced” to use secure mode.
If we make the purchase with the secure mode (with 3D Secure) the thing changes. First of all, when you buy with this level of security the responsibility directly affects the buyer because it has been confirmed in a reliable way its purchase by number, expiration date, cryptogram and, above all, secret key. From here, the bank can not interfere (because it is no longer responsible) and transfers the money to the owner’s bank of the virtual e-commerce POS.
With this change of role, the responsibility is to the buyer and no one can make a claim for that payment. Here is the importance and necessity of 3D Secure for banks.
- At banks are interested grant payment methods with 3D Secure security level so that responsibility rests with the buyer.
- Those buyers are interested in the model 3D Secure to increase security in the purchasing process and having to check with a secret password or PIN additional operation.
- At online stores are interested that all cards are accepted and not have interrupted orders. Perhaps with the immediate and automatic activation of 3D Secure on the cards, the process would be beneficial for all three parties.
It is essential that the evolution of security in payment methods continues to grow hand in hand with the effectiveness and simplicity for buyers and sellers.