Wells Fargo launched three-domain verification for WellsOne
commercial card customers' online payments, claiming to be the first U.S. bank
to offer the fraud-prevention method for commercial cardholders. The service is
available for MasterCard and Visa-issued cards. Visa confirmed Wells Fargo's claim.
3-D Secure, as it's known in the payments industry, connects
the issuer, the network card company and the acquirer, which manages the
merchant account, to verify cardholder identity and merchant credibility.
Wells Fargo cardholders proactively can register their cards
online by creating a passcode and security question, or will be prompted to do
so when making online purchases with participating merchants. Merchants have
the option of stopping the purchase if the card is not registered, or allowing
the cardholder to bypass enrollment and continue with the purchase.
Once registered, cardholders making subsequent purchases
with participating merchants will be prompted to enter their password or answer
their security question instead of entering credit card information, thereby minimizing
the possibility of fraud.
"It allows cardholders to feel more secure because they
have to authenticate themselves before they can actually process a payment
through the Internet on their card account," said Wells Fargo senior vice
president and manager of commercial card products Mary Mazzochi.
Before implementing 3-D Secure, Wells Fargo's standard fraud-mitigation
routine included examining fraud patterns from Visa, MasterCard and retailers
and building queues to manage and review transactions on a daily basis,
according to Mazzochi. She claimed that while Wells Fargo's portfolio
consistently outperformed the industry on fraud prevention, fraudsters have
switched their attention to online transactions amid the spread at physical
points of sale of chip-and-PIN technology, which provides more protection than
standard magnetic stripe cards.
The solution has been available for Wells Fargo's consumer business, but Mazzochi said the
company only during the past year—as chip-and-PIN (also known as EMV) began to
be more widely adopted—noticed the need on the commercial side.
"We are seeing an increased level of attacks and more
pressure in the U.S. market," Mazzochi said. "So [3-D Secure] is just
another way to mitigate that."
She added that as more international e-commerce merchants adopt
3-D Secure solutions, cardholders using their cards internationally without such
a solution can experience challenges. Merchants are "starting to become
aware of the capability and fraud protection with the service, so we're seeing
more adoption," she said. "3-D Secure seems like a no-brainer."
Citi is another bank that uses 3-D Secure, having deployed a
solution in Europe, the Middle East, Africa, and Asia/Pacific.