- Protection against chargeback
Whether the chargeback claims are accurate or fraudulent, your business does not bear the cost of any chargeback claim.
3D Secure helps mitigate the resources associated with dispute management, chargeback penalties, and fees because businesses are not liable in cases of chargeback claims.
In the past, when a chargeback occurred, the merchant was typically liable for this transaction; 3D Secure changes that.
As a business, customer confidence is critical for your success. Many customers will feel more confident knowing there is an extra level of security to protect their data.
When discussing the disadvantages of 3D Secure, we have to talk about the cost of implementation. Although the exact prices can vary depending on the payment gateway, acquirer, and issuer involved, fees are attached to each transaction processed through 3D Secure.
Apart from that, there are costs associated with integrating 3D Secure into the merchant’s payment gateway. All these costs add up quickly, so merchants need to decide whether the benefits of 3D Secure outweigh the additional implementation costs.
- Decrease in conversion rates
The conversion rate refers to the number of users who initiated the checkout process versus those who paid and completed their purchase.
Customers want to complete the payment process as quickly as possible; the extra authentication step increases the time spent on the transaction, and some customers find it more complicated.
All this leads to an increase in the frequency of abandoned transactions and a decrease in conversion rates.
- Potential technical issues
Like any technological improvement, incorporating or implementing it may involve technical issues. For example, the card issuer sometimes does not send the customer the one-time password on time; in some cases, they do not even send it.
This hiccup will lead to a failed transaction because it can only be completed with the password.
This is just one of the many technical issues that could emerge.
There are a couple of disadvantages of 3D Secure, but it has become evident over time that the pros heavily outweigh the cons, especially for merchants.