A Nigerian e-commerce firm observes a recurring financial threat where cybercriminals execute unauthorized card-not-present (CNP) purchases using valid, stolen payment card credentials purchased online. Although the merchant's portal uses end-to-end data encryption for transport security, legitimate cardholders subsequently dispute the unauthorized billing, causing the firm to suffer severe losses from bank chargebacks. Which security technology should the firm integrate into its payment gateway to directly mitigate this authorization fraud by requiring real-time identity verification from the card-issuing bank during transaction processing?
- Three-Domain Secure (3D Secure) authentication protocolAnswer
- BTransport Layer Security (TLS) data encryption
- CPerimeter packet-filtering network firewall
- DPoint of Sale (POS) biometric merchant terminal
Answer
Three-Domain Secure (3D Secure) authentication protocol
Three-Domain Secure (3D Secure) is an XML-based authentication protocol designed to add an extra layer of security for card-not-present online transactions. It ties the financial authorization process with an explicit identity verification step (such as a One-Time Password or biometric authorization) controlled directly by the issuing bank. Upon successful verification, liability for fraudulent chargebacks shifts from the merchant to the card issuer.
Step-by-Step Solution
Key Concept
Card-Not-Present (CNP) Fraud and E-Commerce Payment Security Protocols