Optimizing the security of credit card payments is not just essential for you as a convenience store owner and beneficial for your customers. Taking maximum precautions in this area also serves Visa, Mastercard, and the other major card brands that have a great deal invested in ensuring the safety of payments. That is why they have come up with a protocol known as 3-D Secure.

What is 3-D Secure?

Technically speaking, 3-D Secure is an XML-based protocol designed to improve the security of the data exchanges that occur between acquiring and issuing banks by the payment gateway during the purchase process. Although many people think of the protocol as beneficial mostly to ecommerce merchants, it also boasts numerous advantages for sellers who do face-to-face sales.

The “3-D” in 3-D Secure refers to the three distinct domains involved in the credit or debit card payment process: the card issuer, the retailer receiving the payment, and the infrastructure platform that functions as a go-between for the buyer and seller. The protocol provides an extra layer of security before a transaction is successfully completed. You can think of it as an added safety precaution that helps to ensure that the transaction is being conducted by the account’s rightful owner. In the case of ecommerce businesses, 3-D Secure goes a long way toward eliminating “card-not-present” fraud, but it can also be tremendously helpful for brick-and-mortar store owners and their customers.

How does 3-D Secure work?

You might be wondering what customers experience when they make payments with a merchant whose system has been optimized with 3-D Secure or the upgraded new approach of 3DS2. In a nutshell, this is the process.

• The customer enters their payment information by swiping, tapping, or dipping their card into or near your card reader. For ecommerce companies, this can also happen over the phone or via the shopper’s mobile phone, tablet, or computer.
• If the system flags the card as potentially suspicious or meriting further investigation, the customer will see a 3-D Secure prompt and will be asked to enter a PIN or password. This might also be a series of numbers sent to their mobile phone.
• The various domains in the system communicate with each other to determine whether the payment should be accepted or declined based on the information provided by the customer.
• The customer receives notification on the merchant’s display screen as to whether the payment has gone through or been rejected.

With the updated version of 3-D Secure 2.0, the authentication process is often so fast and smooth that most customers do not even realize that it has occurred.

How 3-D Secure can benefit your convenience store.

When you run a fast-paced retail business such as a convenience store, you most likely have several staff members holding down the cash register. Although you certainly have your share of regular patrons, many of the people who enter your shop may only come once. For these reasons, it is often difficult to use strategies such as facial recognition to intuit whether someone is trustworthy or not. This makes implementing additional safety procedures like 3-D Secure even more important.

This is the perfect time to bring up the dreaded subject of chargebacks. The bane of every business owner’s existence, these forced refunds occur when customers contact their credit card company to request a refund after purchasing merchandise from you — often without first contacting you to attempt to resolve the situation. There are numerous reasons why people demand refunds: misunderstandings, buyer’s remorse, dissatisfaction with a product, and even deliberate fraud. But no matter what the cause might be, the merchant always gets the bad end of the deal. That is the case even if the seller has done nothing wrong and even if an investigation eventually finds in the merchant’s favor.

Because chargebacks are exhausting, time-consuming, and expensive for you as a seller, it is in your best interests to do everything you can to minimize their impact. Of course, you can never totally eliminate chargebacks from your life, but taking steps such as implementing 3-D Secure can go a long way toward lessening their sting.

That’s because, in spite of the heightened card security that has come about since EMV chips came into play several years ago, bad actors are still finding ways to steal people’s identities and use their credit cards. In an era when most point of sale systems are not even configured to ask for PINs or biometric verification, criminals can steal someone’s card and start tapping and swiping it all over town and across the internet without ever being asked to verify their identity.

The 3-D Secure protocol puts a stop to a great deal of this bad behavior. When the system scans the card and runs its numerous data points through its algorithms, it often flags the fraudster’s card, thus triggering a request for authentication that the thief cannot accurately fulfill. As a result, the legitimate holder of the credit card will not get a bill three weeks later filled with charges they never made and have no choice but to dispute.

In the event that your shady customer uses a card that is enrolled in a 3-D Secure Program (Verify by Visa or Mastercard SecureCode, for example) and the transaction goes through, you as the merchant will be protected if the legitimate customer the card was stolen from disputes the charge. However, it must be said that 3-D Secure is an opt-in program that, while it is gaining traction, has still not been universally adopted. Fortunately, the roll-out of the new approach of 3DS2 has encouraged many once hesitant sellers to amp up their security measures in this way.

As the owner of a convenience store, you must already contend with high staff turnover, transient customers, physical safety risks, and skyrocketing overhead and product prices. While many of these factors are beyond your control, there is definitely something you can do to optimize the safety of the in-person credit card transactions you process. Talk to your payment services provider today about taking your systems to the next level with 3-D Secure to provide you with that extra layer of safety.