Payments security key to Asia's post-pandemic digital commerce: Visa
By Digital News Asia June 1, 2021
- Key trends: contactless payments, on-demand e-commerce, blurring commerce lines
- Fraudsters evolve methods faster than consumers, businesses can prepare for
THERE is a need for better robust payment experiences in a changing commerce environment and to focus on strengthening payments security as consumer behaviour evolves during the Covid-19 pandemic, according to Visa.
Addressing more than 1,500 partners and clients in its first virtual Asia Pacific Visa Security Summit, the digital payments provider charted three pervasive trends in Asia Pacific that will change in the near future, Visa said in a statement.
The first is that contactless payments are becoming a health and safety priority; the second, on-demand e-commerce experiences have heightened expectations of quality and speed of service; and finally, the lines between e-commerce and physical buying have been blurred.
Because of these trends, Visa noted that fraud has migrated from traditional storefronts to digital commerce. Consequently, it urged the industry to take proactive steps to tackle them.
“The pandemic has greatly accelerated changes in consumer behaviour, commerce and hence digital payments. We believe these patterns are here to stay and many first-time digital consumers will decide where to shop based on whether they trust the seller or not,” said Joe Cunningham, regional risk officer, Visa Asia Pacific.
“As digital commerce becomes mainstream, payment security is a fundamental driver of trust so the industry must deliver on consumers’ expectations of safe, convenient and fast payment experiences.”
Visa expects contactless payments to replace cash and become the preferred payment method for businesses and consumers, with consumers prioritising health and safety. As of Feb 2021, Visa noted that one in two face-to-face Visa transactions in Asia Pacific are now contactless.
Besides that, e-commerce experiences are also shifting. Shoppers now expect products and services to be available when and where they want. This, Visa said, will require faster, smoother and more convenient buying and payment experiences.
Additionally, there is an increasingly blurring of lines between e-commerce and physical buying. Visa data shows that, excluding travel, global e-commerce payment credentials grew over 20% in the last quarter compared to the same period last year, while e-commerce payments volume averaged at least 30% growth in India and Singapore over the last three quarters.
This shift is likely to persist as e-commerce growth continues to be robust even as consumers begin to return to stores, Visa said.
“Fraudsters evolve their methods faster than consumers and most businesses can prepare for. To stay ahead of the curve, the payments ecosystem must buttress existing infrastructure with enhanced and trusted fraud management solutions,” added Cunningham.
“In an increasingly digital world, payments security is crucial for consumer trust and must be the foundation of business and commerce, now and in the future.”
To deal with such fraud, Visa has introduced solutions such as Visa Secure. It uses the latest standards of the EMV 3-D secure protocol and adds a layer of fraud defence so financial institutions and sellers can be confident that transactions are genuine.
This potentially reduces lost sales for sellers because of declined payments and improves the overall consumer shopping experience, Visa claimed.
Visa Token Service (VTS), on the other hand, turns sensitive payment data like card numbers and account details into randomised tokens, thus devaluing data and rendering it useless for fraudsters even if stolen.
Visa’s data for the US shows that tokens can reduce fraud by 26% on average compared to online card transactions where consumers enter their card details for making payments, it claimed.
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