2D Payments Without 3D Secure

The PSD2 directive provides several exemptions from strong customer authentication:

1. Low Value (under €30):

• Transactions below €30
• Cumulative limit: €100 or 5 transactions
• Ideal for micropayments and in-app purchases

2. TRA (Transaction Risk Analysis):

• Real-time fraud scoring
• Thresholds based on historical fraud rates
• Up to €500 if the fraud rate is below 0.01%

3. Recurring/MIT:

• Subscriptions after an authenticated first payment
• Merchant-initiated transactions

4. Trusted Beneficiary:

• Merchants whitelisted by the customer

We automatically apply the optimal exemption for each transaction.

On a 2D transaction (without 3D Secure), chargeback liability sits with the merchant, not the issuing bank. That is why our scoring is crucial:

Our protection:

• Real-time fraud scoring before every 2D decision
• Automatic blocking of suspicious transactions
• 3D Secure triggered when the risk is high

Our guarantees:

• Average fraud rate below 0.5% on 2D transactions
• Continuous monitoring and real-time alerts
• Dispute kit for chargebacks

The right balance:
Our goal: maximise 2D for conversion while keeping fraud at an acceptable level.

TRA (Transaction Risk Analysis) analyses every transaction within a few milliseconds:

Data analysed:

• Device fingerprint (device, browser)
• Geolocation and IP consistency
• The customer's history with your store
• Velocity (number of recent transactions)
• Amount vs usual behaviour

Automatic decision:

• Score below threshold → 2D (no 3DS)
• Score above threshold → 3D Secure triggered

Regulatory thresholds:
TRA thresholds depend on your historical fraud rate:

• Fraud below 0.01% → exemption up to €500
• Fraud below 0.06% → exemption up to €250
• Fraud below 0.13% → exemption up to €100

SCA exemptions depend on the issuing banks' cooperation:

European cards (EEA):

• Exemptions must be recognised
• 2D success rate above 90%

UK cards (post-Brexit):

• The UK runs its own, similar SCA regime
• Exemptions generally accepted

Non-European cards:

• Not subject to PSD2
• 2D often possible by default
• 3DS optional (recommended for protection)

Our approach:
We detect the card's origin and apply the optimal strategy for each case.

The recurring/MIT exemption lets you charge subscriptions without re-authentication:

Setup:

1. First payment with 3D Secure (initial authentication)
2. Secure card storage (tokenisation)
3. Subsequent payments without 3DS (MIT exemption)

Conditions:

• The customer consented to the subscription
• The amount and frequency are known
• The first payment was authenticated

Use cases:

• Monthly/annual subscriptions
• Automatic renewals
• Fixed recurring payments

Result:
0% abandonment on renewals vs 10-15% with 3DS every time.