Starling warns customers of SCA disruption

Starling Bank has warned its customers that more transactions may be declined when new Secure Customer Authentication (SCA) rules come into play next week.

In a message to its customers, it said that they may noticed that the bank asks them to approve online purchases more often and that from Monday 14th March there may be an increased number of rejected purchases.

The bank explained that from now on all financial institutions and retailers are required by law to use the 3D Secure system – which Starling already has in place - to help stop fraudsters.

It said however that some retailers might not be ready.

“If you’re making an online purchase that needs extra security checks, but the retailer isn’t using 3D Secure properly, your payment might be declined,” it said. “If this happens, it’s a good idea to get in touch with the retailer to see if you can pay them another way.”

GoCardless also warned that paying by card is about to get “a lot more painful” thanks to the new rules.

“Consumers making online payments will now be faced with interruptions to their payment journey and asked to take extra steps to verify their identity,” said Siamac Rezaiezadeh, director of product marketing at GoCardless. “These added layers of security are yet another example of the card industry adding inconvenient bolt-ons to compensate for the fact that cards were not designed for an online world.

“We’re already seeing a surging interest in payment methods that can solve for this imminent headache. Payments that come directly from a customer’s bank account, such as those powered by Open Banking, are SCA-compliant by design because authentication is built seamlessly into the checkout flow. This offers the streamlined online payment experience people have come to expect, and limits conversion and churn risk for businesses.”

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