{"id":5328,"date":"2019-06-06T14:32:37","date_gmt":"2019-06-06T14:32:37","guid":{"rendered":"https:\/\/fintech.global\/globalpaytechsummit\/?p=5328"},"modified":"2019-06-06T14:32:37","modified_gmt":"2019-06-06T14:32:37","slug":"europe-could-lose-e57bn-following-sca-implementation-stripe-study-claims","status":"publish","type":"post","link":"https:\/\/fintech.global\/globalpaytechsummit\/europe-could-lose-e57bn-following-sca-implementation-stripe-study-claims\/","title":{"rendered":"Europe could lose \u20ac57bn following SCA implementation \u2013 Stripe study claims"},"content":{"rendered":"

Europe is set to lose \u20ac57bn in economic activity in the first 12 months after Strong Customer Authentication SCA takes effect, a study from Stripe claims.<\/strong><\/p>\n

The investigation, which was conducted by 451 Research, was based upon surveys filled in by 500 qualified payment professionals at online businesses and 1,000 consumers across the UK, France, Germany, the Netherlands and Spain.<\/p>\n

SCA is part of the EU\u2019s PSD2 directive and will fully come into effect on September 14. It requires require European consumers to confirm their identities for online purchases with 2-factors of authentication. This can be either something they know, like a password, something they have such as a phone and something physical about them like a fingerprint.<\/p>\n

Through the research, the company found only 40 per cent of businesses aware of SCA said they felt prepared for it. With the deadline looming, only 44 per cent believe they would be compliant on the day it launches.<\/p>\n

Three in five businesses with under 100 employees are either unfamiliar with SCA, do not plan to be compliant by the September deadline, or are unsure whether they will meet compliance. Larger institutions seem much more tuned in with developments, with only\u00a01 in 25 companies with 5,000 employees being unaware of SCA.<\/p>\n

In a bid to overcome compliance complications, many businesses are attempting to lower the amount of transactions which SCA is needed, the report stated. There are a few exemptions which can enable this, such as recurring payments, or transactions under \u20ac30 can be approved without the added layers.<\/p>\n

When looking to solve challenges from the regulation, 50 per cent stated they plan to handle management completely in-house.<\/p>\n

Stripe believes this presents a challenge for them. It said that exemptions are tough to administer due to the need of visibility on card networks. An example provided is that while purchases under \u20ac30 are exempt from SCA, once five transactions below \u20ac30 have been made or a combined value of \u20ac100 has been reached, the customer\u2019s bank will request SCA.<\/p>\n

Pressures on ensuring simplified customer checkout experiences were highlighted in the study. Of the respondents 74 per cent of Gen Z shoppers said they had abandoned online purchases due to poor experiences. Going on, 52 per cent proceeded to buy the product at a competing merchant.<\/p>\n

Stripe stated the introduction of SCA will \u2018likely\u2019 make things worse. Of the respondents, 73 per cent said they were unaware of the impending authentication requirements.<\/p>\n

451 Research analyst Jordan McKee said, \u201cSCA is unequivocally the single most disruptive event to impact European digital commerce, and many businesses\u2014especially smaller ones\u2014have yet to fully grasp its extensive impact. Our study indicates low levels of preparedness and, most troublingly, a lack of appreciation for how SCA will transform how European consumers will buy online.\u201d<\/p>\n

 <\/p>\n

Copyright \u00a9 2019 RegTech Analyst<\/p>\n","protected":false},"excerpt":{"rendered":"

Europe is set to lose \u20ac57bn in economic activity in the first 12 months after Strong Customer Authentication SCA takes effect, a study from Stripe claims. The investigation, which was conducted by 451 Research, was based upon surveys filled in by 500 qualified payment professionals at online businesses and 1,000 consumers across the UK, France,… <\/p>\n

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