Post on 15-Dec-2015
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The New Landscape of Authentication
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Moderator Marty Avalos » Paciolan
Presenters
Scott Boding » CyberSource Ian Poole » Cardinal Commerce
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»
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Marty AvalosPaciolan
All rights reserved CyberSource® 2015#PACnet15
The New Landscape of AuthenticationBalancing the consumer experience with risk and costs - intelligently
Scott Boding
Ian Poole
All rights reserved CyberSource® 2015#PACnet15
Confidentiality Notice
By accepting this presentation and the information herein, you acknowledge that the information furnished to you is confidential, (the “Information”) and that your use of the information is limited to your business dealings with CyberSource Corporation, or its affiliated company, (“CyberSource”). You agree to keep the Information confidential and not to use the Information for any purpose other than in your business dealings with CyberSource. The Information may only be disseminated within your organization on a need-to-know basis to enable your participation in business dealings with CyberSource. Please be advised that the Information may constitute material nonpublic information under U.S. federal securities laws and that purchasing or selling securities of Visa Inc., the parent company of CyberSource, while being aware of material nonpublic information would constitute a violation of applicableU.S. federal securities laws.
Disclaimer
Studies, survey results, research, recommendations, and opportunity assessments are provided for informational purposes only and should not be relied upon for marketing, legal, regulatory or other advice. Recommendations and opportunities should be independently evaluated in light of your specific business needs and any applicable laws and regulations. CyberSource is not responsible for your use of any studies, survey results, research, recommendations, opportunity assessments, or other information, including errors of any kind, or any assumptions or conclusions you might draw from their use. Except where statistically significant differences are specifically noted, survey results should be considered directional only. Neither CyberSource, nor any of its employees, subsidiaries, parents, or affiliates make any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information disclosed herein.
Please note: This content may not be reproduced, distributed, or transmitted in any form or by any means, without prior written permission of CyberSource.
Stuff Legal Makes Us Say
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Agenda
How CyberSource Helps Paciolan Merchants
Deeper into CyberSource Decision Manager
New Rules Based Payer Authentication
Paciolan and CyberSource Partnership
Q & A
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How Can CyberSource Help Paciolan Merchants?
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TOKYO
MIAMI
SAN FRANCISCO
CyberSource: Global Scale, Local Expertise
$314BIn
PaymentsManaged
in2014 Over
400,000Customers
MEXICO CITY
SÃO PAULO
LONDONMOSCOW
MUMBAI
SYDNEY
SHANGHAI
SINGAPORE
A Visa Inc. Company Since 2010
All rights reserved CyberSource® 2015#PACnet15 All rights reserved CyberSource® 2015#PACnet15
Transfer
190Countries
45+Funding
Currencies
Global andCountry Cards
Direct Debit and Bank TransfersDigital Payments
ONE CONNECTIONPROVIDES GLOBAL REACH
Payment Management Platform
“All brand names and logos are the property of their respective owners, are used for identification purposes only, and do not imply product endorsement or affiliation with CyberSource.”
All rights reserved CyberSource® 2015#PACnet15 All rights reserved CyberSource® 2015#PACnet15
Accurate Detection• Reduce fraud rate• Minimize chargebacks
Positive Customer Experience• Reduce false positives• Increase acceptance
rates• Lower review rates• Review orders faster
Efficiency• Maximize automated decisioning• Streamline review process• Maximize data and system integration
Fraud
Conversions
A Holistic Approach to Fraud Management
Operational Efficiency
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3
Case Management System
• One console with all necessary data sources to make decision
• Manage review queue priorities and team assignments
4
Tuningand Analytics
• Real-time reporting suite: financial, operations, review team analysis
• Fine tune with passive testing without impacting operations
2
RulesEngine
• Flexible rule building
• Change rules instantly
• Use our risk score or customize your own
DetectionRadar
• Proven risk model
• Detection insights from over 60 billion Visa and CyberSource transactions
• Global multi-merchant data
• 260+ detection tests
• Device finger-print analysis
1
Web / Mobile / Call-Center
CyberSource Decision Manager
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Massive Data Set For Better Accuracy
260 Real-Time
Correlation Tests
60BAnnual
Visa & CyberSourceTransactionsWorldwide
Compare with insights from over…
Order
BusinessRules
Tests
Accept Reject Review
Increases Fraud Pattern Visibility
200XTransact ››
Global Decision Management System
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Fraud Management Transaction Flow
Transaction History and
Tests
Business Rules
Automated
Mobile
CallCente
r
Kiosk
POS
Ticket Order
s
Web
FraudAccept
Decision
Reject
Manual Review
Tuning and Analytics
2.9%
0.90%(revenue)25%7.8%
0.47%(revenue)
1.9%
Source: CyberSource Online Fraud Report, average figures across all respondents
Source: Weighted Average of all Managed Risk Services Merchants
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Fraudster “pretends” touse another computerto escape detection
Proxy piercingdevice fingerprinting
X
Excessive phone number, email, credit card repeats in a short time frame
Fraudster tries to make as many purchases as possible before getting caught
fraudster behaviorexample auto
detectors (260+ for every transaction)
BIN country does not equal bill country
Fraudster steals credit card number but doesn’t have associated account informationX
260+ Automated Detection Tests
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Triangulation Schemes
What we shared last year at PACnet ‘14
Account Takeover
Clean Fraud
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This year: we’re highlighting a new product added to our fraud management product suite :
Rules-Based Authentication
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First Some Background: What is Payer Authentication? (aka 3-D Secure™)
Payer Authentication is a means of “authenticating” a consumer with their card-issuing bank during a card-not-present transaction.
– Authentication protocol developed by Visa in 1999; branded as: 3-D Secure™
– Programs based on the adopted protocol offered by most major payment brands:
– Mandated in many countries and regions – International Standard– May qualify for fraud chargeback liability shift to Issuer - [Sounds
Good, Right?]
“All brand names and logos are the property of their respective owners, are used for identification purposes only, and do not imply product endorsement or affiliation with CyberSource.”
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Challenges of Traditional 3-D Secure™
Traditional 3-D Secure challenges all orders
• Interrupts consumer checkout process
• Poor User Experience
• Higher Abandonment
Can be more costly to merchants than fraud
itself
Source: Cardinal Commerce
Friction!
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New and Improved! – Rules Based Payer Authentication
Traditional Rules Based
Transaction Type
Consumer Profile
Consumer Routing
Real-Time Rules Filters
Invisible Auths
Provides merchants with relevant data to make intelligent
authentication routing decisions for
deliver the most streamlined user
experience for the order scenario.
Configuration Options Comparison
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Consumer Experience by Authentication Method
Not Participating in 3-D Secure
• Consumer experience impact: None, no action required • Issuer is not participating
Risk Based 3-D Secure (No Challenge)
• Consumer experience impact: Low to none• Issuer uses a risk-based approach to determine risk• Majority determined as low risk and are not challenged
Risk Based 3-D Secure (Selectively Challenged)
• Consumer experience impact: Low • Issuer uses a risk-based approach to determine risk• Only high risk transactions are challenged using the issuer
authentication method
Traditional 3-D Secure (Enrolled Only)
• Consumer experience impact: Medium to high • Account is enrolled in the issuer’s 3-D Secure program• Consumer is challenged for every transaction
Traditional 3-D Secure (Activation – During Shopping)
• Consumer experience impact: High • Customer transferred to the issuer for enrollment into the
optional program• If customer does not enroll, 3-D Secure benefits may still be
honored
Consu
mer
Check
out
Fric
tion
3-D Secure programs may offer liability protection, but at what cost to the user experience?
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US Issuers Approach to 3-D Secure
Source: Cardinal Commerce 2014
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Set Rules to Define When to Route for Authenticationworks with Verified by Visa, MasterCard SecureCode and other 3-D Secure programs
Example: present transaction for authentication if issuing bank uses risk-based authentication and does not challenge customers
Create Authentication Rule
Centinel Platform accessed through CyberSource Platform
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Rules Based Payer Authentication Merchant Benefits
Complements Decision Manager
MerchantControl
LessManual Review
Global Coverage
SafelyAccept Orders
Liability Shiftfrom Merchant
to Issuer
…accessed from Paciolan via the CyberSource API
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Paciolan and CyberSourceA Powerful Partnership
24
Paciolan and CyberSource have partnered to offer the CyberSource Payment Management solutions to Paciolan customers worldwide.
Risk IntelligenceUnrivalled access to the combined power of Paciolan and CyberSource data giving a unique advantage in managing fraud.
SimplicityProvides a one-stop-shop for a cross-channel, independent, global integrated ticketing and fraud management solution.
Time to marketPre-developed integration increases speed to market and reduces system development and maintenance costs.
OptimizationIncreased automation streamlines the complete sales, payment and fraud management process.
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Visit CyberSource at Booth #207
www.cybersource.com
Learn More…
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Please complete either the session evaluation form on your chair or online at http://pacnet.paciolan.com/schedule.
Thank you!Questions