TalkingID in the context of SCA
Informative > Useful Clarifications
Why is TalkingID the best biometric method for Strong Customer Authentification (SCA)?
TalkingID in the context of Strong Customer Authentification (SCA)
One of the key pillars of PSD2 is Strong Customer Authentication (SCA); a new European requirement to make online payments more secure and prevent fraud. To accept payments after SCA comes into effect at least two of the following three factors must be used:
- Knowledge (PIN, Password)
- Possession (credit card, smartphone)
- Inherence ("includes techniques such as retina, iris and fingerprint scanning, voice recognition and others"). *
Payment service providers must use SCA whenever customers access a payment account online, initiate an electronic payment transaction and for "any activity through a remote channel that potentially poses a risk of payment fraud or other misuse." In addition some remote payment transactions - including Internet and smartphone payments - must dynamically link the transaction to a specific amount and payee and generate a unique authentication code. As a result of the dynamic link any change in the amount or payee identity will invalidate the code.
PSD2 represents a significant step towards greater consumer protection in the event of loss, theft, misappropriation and faulty security measures. Payment service providers (PSPs) bear full responsibility for payments that have not been executed correctly. As a result, they are obliged to immediately refund the total amount of the unauthorized payment transaction to their customers. Only if payment service users act with fraudulent intent or gross negligence, they are fully liable. Therefore, it is critical for PSD2 compliance that financial service providers implement a strong and secure method of customer authentication. It must minimize the risk of identity theft, maximize customer trust and at the same time reduce fraud related costs as much as possible.
The New Role of Biometrics
In realizing secure customer authentication, organizations increasingly view biometrics as the optimal authentication approach because it improves both security and the customer experience. Combined with a possession or knowledge factor, biometrics thus contributes to secure two-factor authentication.
Given the prevalence of biometric authentication in many smartphone and tablet devices such as fingerprint, facial recognition and voice recognition users have become accustomed to biometrics as a secure and convenient alternative to passwords.
How SmartBiometrics can support
SmartBiometrics' biometrics solution helps you meet PSD2 and SCA mandates by increasing the security of authentication and fraud prevention processes while enhancing customer experience. Companies need to find the happy medium between four goals:
- Optimize customer satisfaction and maximize acceptance of transactions.
- Minimize fraud-related losses by detecting and rejecting fraudulent transactions.
- Reject fraudulent transactions while avoiding false negative.
- Reduce fraud prevention costs by automating fraud prevention mechanism.
On June 21, 2019, the European Banking Authority (EBA) declared the validity of various biometric methods as a factor in the inherency category. In doing so, it opened the door for the implementation of sophisticated customer authentication methods that are not dependent on potential security vulnerabilities in communication infrastructures. SmartBiometrics' biometric solution for customer authentication and fraud detection is based on deep learning AI algorithms that enable fast and reliable authentication. It detects also runtime errors (typical of audio compression), removes background noise (acoustic reflection), recognizes all known audio compression techniques, recognizes identical patterns and uses strong anti-spoofing techniques for fraud detection.
Our advantage is the highest possible accuracy, the sophisticated fraud detection on 4 levels, the Deep Learning AI used, the special app for recording audio files, the blockchain encryption of the biometric data transmitted by the app. That ensures verification of the speaker's identity with an accuracy of over 99.998%.
TalkingID makes decisions based on these recognition and risk signals.
* European Banking Authority, June 21 2019 - https://www.eba.europa.eu/single-rule-book-qa/qna/view/publicId/2020_5353