Nationwide Building Society has said it is preventing 2000 additional online shopping fraud attempts, following the introduction of technology to comply with Strong Customer Authentication (SCA) regulations.
The mutual society said two-thirds of its customers are happy to wait a little longer in exchange for the extra security.
SCA rules mean that any online payments worth more than €30 would require two methods of authentication from the person making the payment, such as a password, biometric authentication or having a phone that can identify them. Payment processing companies must meet SCA regulations, which is part of the EU’s Payment Services Directive 2 (PSD2). The service was rolled out across all online purchases on 14 March after a delay caused by the Covid-19 disruption.
Nationwide’s data shows that 70% of its members complete the SCA check using their mobile banking app, while 21% authenticate using a one-time passcode sent via a text message.
A total of 42% of Nationwide customers surveyed said SCA makes them feel safer, and 27% said it makes them more likely to shop online.
Matt Cox, chief product owner for digital payments at Nationwide, said: “Many people prefer the convenience of online shopping and, while merchants strive to make the checkout experience as quick and easy as possible, we generally accept that a small delay is worth it when it comes to our security and personal details.
“The introduction of new SRA measures adds just a few extra seconds to the check-out process for higher risk transactions, but they are vital for retailers, banks and building societies to check it is the card owner making the purchase. It’s been just two months since the new regulations were fully rolled out, but already we are seeing around 2,000 fewer cases a month of online card fraud and this is likely being replicated across the industry.”
Read more about strong customer authentication
- Financial Conduct Authority gives companies under its watch an extra 18 months to meet an EU payments security standard.
- The original deadline for PSD2 compliance quietly passed by at the weekend but it will be another 18 months before UK businesses meet the regulation’s rules on customer authentication.
- The announcement that the FCA was given permission to give extensions to companies implementing Strong Customer Authentication was a gentle reminder that a major deadline was close.
Nationwide offers different options to customers to complete the SCA checks, including authentication using the mobile banking app, one-time passcode via text, one-time passcode using the card reader, one-time passcode via a landline and one-time passcode via email.
But Cox warned: “While this is good news, history has shown us that when we interrupt fraudsters, they will often look for other, easier ways to trick people out of their hard-earned money. This means we must always remain vigilant as we keep our members’ money safe.”