What a time to be alive. You can buy a new pair of shoes, order lunch, and book an appointment without uttering single word. That’s the beauty of living in an online world where you can communicate, purchase, and find things at a click of a button. Convenience has become our daily bread and technology, our life force. We cannot, however, forget that with positive growth and evolution comes new challenges. In the case of online solutions, the rising challenge is security.
In 2020, $4.2 trillion had been spent on online purchases worldwide, but a significant amount of those purchases were fraudulent or done illegally. We are witnessing a rise in cybercrime each day. This results in a growing need for stronger online security methods and online authentication processes.
What does online authentication entail?
To complete any purchase in life, you need to make a payment/payment arrangement. Online shopping is no different. For a payment to be successfully and safely executed, however, payment authentication must take place.
Payment authentication refers to the process of verifying transactions made online, specifically using debit/credit cards. The authentication process entails:
- Communications flowing between customer banks and online payment gateway/solution
- Verification of customer identities
- Reviewing transaction
- Producing confirmation receipts to customers
- Fulfilling order payments
Why is online authentication a necessity?
It’s easy for stores to confirm one’s identity when they are paying in-store, but it becomes difficult when they are paying online. The main challenge with online payments, in particular, is security. Unlike in-store sales where you need a physical card or cash to complete the transaction, online payments just need you to complete your card/account details. This means that anyone with your card details can go on an online shopping spree without your knowledge. As a result, this opens customers up to:
- Credit card fraud
- Incomplete/failed transactions
- Cyber crimes
- Sensitive data threats
So, how do you ensure that the right person is making an online payment with specific card? You use business solutions that help you authenticate online payments accurately and securely.
How do online authentication and online authorisation differ?
These two are easily mixed up with one another, but they are quite different. Online authentication is when we confirm that someone is allowed to access an account’s funds to complete an online purchase. Online authorisation, on the other hand, is the process of checking if the payment method is valid and if accounts have sufficient funds to complete purchases as well.
Regardless of their differences, these functions always go together. Furthermore, within the typical payment cycle, authorisation always follows authentication.
What types of online authentication can you use?
Payment processing solutions use various ways to authenticate an online customer. To list, here are common methods these systems use for authentication:
- Card Verification Value (CVV):
3–4-digit code on the back or front of a credit/debit card.
- One-time pins:
Codes are receivable via email, message, or voice call
- Address Verification System (AVS):
Also known as proof of residence.
- Challenge-Handshake Authentication Protocol (CHAP)
Authentication using a challenging question only the cardholder can answer.
- Authentication apps:
Generate unique codes every few minutes
Where can you get a solution that supports authentications?
Digitrade is an eCommerce solution that allows you to create and manage a website. Specifically one that supports payment gateways and other authentication software. Over and above that, Digitrade also conducts authorisation for your internal staff. Thus, you can easily set up your website to authenticate the identities of internal people accessing your website’s backend. This way, you limit how many people can update your website and configure permissions. Thus, giving you greater control over it.
To learn more about what Digitrade can do for you, click here.