Customers in Europe are experiencing significant friction at checkout due to SCA requirements. The reason for this is 3D Secure, or 3DS, the protocol to implement SCA, which uses three domains to authenticate consumers and sign transactions during card-not-present (CNP) transactions.
3DS poses some challenges: it is ridiculously difficult for consumers to use, with some unable to view the 3DS authentication page on their devices. Additionally, there are compatibility issues when the authentication process occurs on mobile devices, as well as really slow loading speeds on the authorisation page. Moreover, the authorisation popup window is not always identified as authentic, resulting in suspicion and transaction abandonment by the customers.
As a result, the financial industry introduced 3DS2, an upgraded version of 3DS, which offers a more frictionless experience for customers, thus reducing cart abandonment. For any transaction to be completed, customers only need to provide 2 out of 3 pieces of personal information, as well as confirm their identity via a short code sent by their bank via SMS.