Shopping online is set to become a little safer as from next month with more identity checks being introduced as part of new anti-fraud rules coming into force on March 14. Indeed, buyers may have already noticed more requests to verify their ID as payments providers and retailers adopt the new Strong Customer Authentication (SCA) rules.

After March 14, if retailers wish to accept an electronic (online) payment they will have to verify the customer’s ID. The steps will be similar to those already faced by people logging into online banking.

Introduced by the Financial Conduct Authority (FCA) and in line with European laws agreed before Brexit, the rules will apply to debit and credit card purchases and impact those who are deemed to be making the ‘riskiest’ purchases. While most low-value retail purchases will be unaffected – payments under £25 - more expensive items will require a password, PIN or a one-time-passcode sent via a text or landline. Logging into banking apps to approve purchases will also be allowed.

As well as high-value purchases, anything bought outside a buyer’s normal spending habits or transacted on a previously unused device, are likely to trigger the extra security checks. The new rules don’t apply if you are buying over the phone.

Mastercard says it expects about 25% of online transactions to require some form of extra verification post-March 14, compared to approximately 1% now. Some card issuers have already started to implement systems in readiness for March 14 and there have been reports of some payments already being declined.

It could also pose a problem for shoppers who don’t use banking apps or mobile phones, but retailers and finance providers have been told to provide several different methods of authentication. Those who use a smartphone but don’t receive a signal at home are advised to download their bank’s app, which will work over Wi-Fi.

Online fraud cost the UK £750m in the first half of 2021 alone.

If you work within the retail sector and would like further advice and support from online fraud, contact a member of our team today to discuss how we can help at enquiries@nebrcentre.co.uk