5 Simple Authentication Methods To Protect Your Credit Card Data


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The process of validating the authenticity of a consumer’s credit card by contacting the business that authorized it is known as credit card authentication. Authentication is generally the first portion of the transaction procedure when using a credit card. The purchase is accepted once the card is verified, the funds are added to the consumer’s credit card bill, and the transaction is credited to the merchant’s account.

Why Payment Authentication is Required

The necessity for payment authentication in online and mobile commerce has never been stronger. In 2020, studies show that global e-commerce spending increased by about 28% approx. $4.2 trillion illegal purchases made using stolen credit card numbers, on the other hand, are increasing at a similar pace.

Authentication is used by banks and lending institutions, as well as merchants and payment services to safeguard customers from fraudulent purchases and chargebacks.

If you’ve ever done any online shopping or used a mobile app, you’ve probably come across some type of payment authentication. One-time passcodes, challenge questions, and fingerprint biometrics are some of the most frequent techniques for confirming your identity and ensuring that purchases made with your credit card or other accounts are genuine.

Thanks to advancements in payment technology, there are several methods for a government agency to combat fraud and preserve credit card information while providing residents with frictionless digital payment transactions. Several strategies can be used separately or in combination for more precise authentication. Let’s take a look at some of the most widely used authentication solutions.

#1. Multi-Factor Authentication (MFA)

A multi-step method is required for multi-factor authentication. A learning test is one approach (security questions). Single-use passwords emailed to your phone or email, and the use of biometrics are other options. These factors provide a high level of protection tha usually isn’t possible with traditional methods.

#2. Biometric Authentication

Most smartphones can do biometrics such as fingerprint and retina scans. The use of this technology is seamless. They are quick and do not necessitate any effort on the buyer’s part. Customers don’t have to recall anything, plus it is also almost impossible to duplicate a person’s biological characteristics.

#3. Risk-Based Authentication

Data analysis and machine learning are being used to provide risk-based authentication. Massive amounts of data are collected at the outset of the risk-based assessment using a variety of parameters. An unusually big purchase, for example, or a continuously shifting IP address. Authentication systems based on risk are quite accurate.

#4. Geographical Location

The customer’s smartphone’s location is used to authenticate them via geolocation authentication. The provider may ban the purchase if the user’s card is authorized in one nation but used in the other.
Geolocation is being challenged by the increased popularity of foreign travel and VPNs. During the transaction, geolocation does not validate the real user. Despite these drawbacks, geolocation is a typically non-intrusive and accurate technique for fraud prevention.

#5. 3D Secure 2.0

The Issuer Domain, Acquirer Domain, and Interoperability Domain are the three domains that make up the 3-Domains-Secure protocol. The 3DS1 was one of the earliest online verification systems. It employs basic yet effective approaches such as static passwords to prevent fraud. It was first launched in 2000 and has since grown in popularity.

The 3DS2 protocol is the second installment of the 3D secure protocol. It provides more protection while also correcting the flaws of its predecessor. Cart abandonment and mobile inconveniences are addressed with the 3DS2 protocol. This prevents clients from abandoning a payment due to irritation, which is a major issue with 3DS1.

Furthermore, 3D Secure seems to be the only technology allowing chargeback liability to be transferred from the merchant to the issuer. A chargeback happens when a cardholder claims that their issuing bank has used their credit card fraudulently. In 3DS1, liability shift was available, and in 3DS2, it will continue to shield businesses from chargebacks.


It is high time for ecommerce enterprises to learn more about authentication and act now to become less susceptible if you haven’t already been a victim. Encourage your customer to report fraudulent transactions or any indicators of illicit activity.

Rakesh Soni
Rakesh Soni is CEO of LoginRadius, a leading provider of cloud-based digital identity solutions. The LoginRadius Identity Platform serves over 3,000 businesses and secures one billion digital identities worldwide. LoginRadius has been named as an industry leader in the customer identity and access management space by Gartner, Forrester, KuppingerCole, and Computer Weekly.


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