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Clock ticking on two-step verification for online card payments

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Since 14 September 2019, issuers, acquirers and payment service providers (PSPs) have been required to comply with the PSD2 regulatory technical standards for strong customer authentication (SCA) for online payments.

Red alarm clock with the text 'SCA' on the dial, which emphasizes the importance of timely implementation of strong customer authentication in the payments.

As many parts of the online card payment chain were not yet ready to implement SCA by 14 September, regulators throughout the EU granted an extension until the end of 2020, subject to strict conditions. This was intended to ensure that cardholders, retailers and businesses in particular did not experience unintended adverse effects from the introduction of SCA.

Dutch Payments Association coordinates SCA Migration Project

To support the Dutch market’s smooth migration to SCA for online payments, the Dutch Payments Association coordinates a migration project for issuers, acquirers and PSPs: the SCA Migration Project.

The migration project involves consultation with other stakeholders, including representatives of webshops and consumers, card schemes and De Nederlandsche Bank(opens in new window) . This keeps everyone informed about SCA developments throughout the payment chain and helps minimise unintended adverse effects during implementation.

Illustration of someone placing an online order on a laptop

On Internetkassa.nu, a website for online businesses (in Dutch)(opens in new window) , Dutch Payments Association Managing Director Piet Mallekoote explains what webshops can expect from the migration project and what they can do to be ready in time for online credit card payments using SCA.

Where does the Netherlands stand?

Issuers did not yet systematically reject online card payments without SCA. During 2020, outdated transactions without SCA – known as legacy transactions – would increasingly be rejected through soft declines. In such cases, the webshop could resubmit the payment to the issuer using SCA.

In the first quarter of 2020, the SCA Migration Project was due to announce when Dutch issuers would phase out support for legacy transactions and introduce soft declines. Webshops were advised to be ready for online card payments using SCA by then.

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