Data from Barclaycard Payments, which processes £1 in every £3 spent on credit and debit cards in the UK, shows that many online businesses are still not fully compliant with the new Strong Customer Authentication (SCA) regulation – which became mandatory for all transactions on the 14th March – and have lost out on £130 million* worth of sales as a result.
Retailers losing out due to SCA
In the biggest change to payments regulation since the roll out of Chip & Pin in 2006, online transactions over £25 are now subject to SCA checks to help combat the £376 million of online fraud committed in the UK each year.
Additional SCA related checks have led to a vast number of transactions being declined as many businesses have not sufficiently prepared themselves for the new regulation, with retailers missing out on millions of pounds in sales each day.
Barclaycard Payments data shows that over 22,000 transactions a day, worth £4.3 million, have been declined in the month since SCA became mandatory.
Improving customer experience
The research demonstrates the importance of using sophisticated payments processing technology to improve customer experience.
The data shows two in five online businesses (37%) have not introduced any new payments technology on their website over the past two years.
However, of those that have, 92% agree that the technology they invested in has improved the checkout experience for their customers – one example being technology that can help reduce the number of SCA-related declines, with other benefits including in-depth analysis of where and when basket abandonment takes place.
Businesses can comply with SCA without adding additional layers of friction to the checkout by deploying intelligent solutions, which leverage an exemptions in the regulation owing to their highly sophisticated fraud checks.
The payments technology, which can be added to existing payment gateways, enables e-tailers to reduce the risk of abandoned baskets, while also keeping consumers secure when shopping online.
“One month on from the introduction of mandatory SCA checks, it’s clear that too many businesses are still not compliant and are losing out on millions of pounds in sales as a result,” says Rob Cameron, CEO of Barclaycard Payments.
“Our research shows that adopting new payments technologies can help businesses reduce basket abandonment while offering customers a faster, more secure check-out experience.
The message to retailers is clear; prioritise SCA compliance, simplify the customer journey and take advantage of the latest payments technologies to avoid losing out on sales and customers.”
*Barclaycard Payments proprietary transaction data, taken between 14 March and 12 April 2022.
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