The issue around Issuer authentication for Apple Pay was cited way back in early January. Issuers have been keen to jump on Apple Pay solution without creating adequate processes for identification, authentication and registration of Apple Pay linked cards. If issuers, register a Fraudulent card the transactions, from the Apple Pay, will be 100% fraud driven! I'm surprised that Issuers did not take into account the impact of such potential risk and are now bearing the consequences of 6% of Apple Pay fraud transactions!

I blogged on this issue a few times in late January including my last post http://sco.lt/8RpMUD on this issue. What surprises is that nearly 6-8 weeks since, we as payment pros, have been highlighting the issue - process for registering the card are still flimsy. There are two paths that were defined for Apple Pay - Green Lane and Yellow path! Yellow path takes greater scrutiny of the iPhone card that is being requested for registration.

What surprises me that registering a card for Apple Pay process was given such little attention by Issuers? This process is no different from Identifying and Authenticating a card holder. And if the card registered was Fraudulent, why did future transactions get authorized - clearly an indication that even the issuers were unaware the cards were compromised or the systems have not been speaking to each other between compromised data cards and card registration for Apple Pay!

It is sad to see Apple Pay name being dragged through the media for Issuer registration process gaps. An easy fix !!