Digital Payments

The ‘Invisible Change’ Coming To Online Shopping


For those who are focused on how better payments can lead to better eCommerce, the upcoming months promise to be an exciting and revealing time. That’s because the newest EMVCo payment specification is freshly out in the world, and the feedback and metrics on its success and failures will soon start emerging.

In a new PYMNTS interview, Simon Armstrong, vice president of products for Entersekt, discussed the June release of the long-anticipated EMV Secure Remote Commerce (SRC) Specification version 1.0. He talked about how its strength will be measured in the short and immediate term, and how the new spec could encourage more eCommerce.

The specification is available for free public download from the EMVCo website. According to the secure payments enabling group, the specification “provides a foundation that will enable … the processing of eCommerce transactions in a consistent, streamlined fashion across a variety of [digital channels] … and devices, including smartphones, tablets, PCs and other connected devices.”

And in August of last year, EMVCo announced the launch of the full EMV 3-D Secure (EMV 3DS) test platform. The platform allows 3DS product providers to confirm that their solutions will perform in accordance with the EMV 3-D Secure Protocol and Core Functions Specification v2.1.0, or its EMV 3-D Secure SDK specification.

Another way to put it is that the new EMV specification promises to enable many more seamless retail transactions. As Armstrong told PYMNTS, the spec will gradually replace the “complex registration journey” that many online shoppers have to undergo before making purchases, a journey that includes passwords and other data entered into multiple fields. Visa, in fact, has said the average online transaction involves 23 information fields.

“In eCommerce, the checkout process is fraught with the chance of the user ultimately not completing the transaction,” Armstrong said. The new spec promises to change that, according to his estimate. “In 80 percent of the cases, a transaction will get an instant approve/decline decision by leveraging a Risk Based Assessment engine.”

Not only that, but the new spec from EMVCo is designed to reduce card-not-present fraud, a prime target for online criminals. Indeed, as he told it, many merchants would rather take a hit on fraud than risk losing sales and customers to the frustration of all those information fields, which can lead to online shopping cart abandonment.

Older specs were designed in a different, seemingly ancient era, when web browsers were the main way consumers conducted eCommerce. “Since the age of the smartphone has come about, people have been moving away from a browser-based world.”

Indeed, he said, the new spec helps point the way toward a future without passwords in favor of biometric authentication methods and tokenized payments. That said, a good deal of work remains when it comes to full deployment and use of the EMV Secure Remote Commerce (SRC) Specification version 1.0. “There are multiple parties that will need to play a role in upgrading from the old version of the spec,” Armstrong said. “The journey will be one that will take months or possibly years. Now it’s a matter of working with issuers and working with the merchants to help them come on board with the new standards. We are in a transition phase.”

So how will success — or failure — be measured in the coming months and years?

“Cart abandonment will drop, and there will be higher conversion rates,” he said. “From the point of view of the issuer, there will be a drop in fraud.”

Consumers, too, should also notice changes soon enough.

“The experience will just appear a lot smoother,” Armstrong said. “It won’t feel like you are being taken out of your normal checkout flow. Gradually, there will be less friction in the process, almost an invisible change.”

That’s what the future holds if the new spec lives up to the promise. Online and mobile shopping keep on growing, but few things can fuel that growth as well as seamless and secure payments.



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