A woman paying with a credit card in a handheld mobile device.

Secure Remote Commerce (SRC) explained

Saturday, December 20, 2014

A new way to protect online transactions

Credit card fraudsters are always trying to outsmart the credit card networks and payments industry to steal valuable card information. To combat in-person, brick and mortar fraud, the card networks developed EMV chip cards. With the boom of ecommerce and online transactions, online card theft is an issue. Luckily, in much the same way, card networks are looking to implement new technology to combat online card theft. In this article, we’ll detail one of the ways they’re doing it – secure remote commerce (SRC). We’ll cover what SRC is, how it works, and how your business can implement it. To start, let’s learn more about SRC.

What is secure remote commerce?

SRC, sometimes called “click to pay,” is a payment technology that makes it easier and more streamlined for customers to pay online using their credit or debit card. The company EMVCo developed the SRC specifications in order to combat card-not-present transactions, and global payment brands, including Visa, Mastercard, American Express, and Discover, have all signed on. This technology allows for a frictionless checkout experience for customers. Before this technology, customers would have to manually enter their payment details into every website they visited to make a purchase. However, SRC helps to remove all of these obstacles by creating a consistent user experience and keeping the payment data so that a person doesn’t have to re-enter their card information on websites that support the SRC technology.

Obviously, when a customer doesn’t have to continually enter their credit or debit card information, it decreases shopping cart abandonment and speeds up the checkout process. That’s good for both the customer and your business as it leads to more revenue and happier customers. But how does a small business like yours put SRC to work? Let’s take a look.

How does SRC work?

In order to fully understand the SRC process, it’s important to understand the components for a new user of SRC before examining the journey of a returning customer.

The new customer journey

When the cardholder is ready to checkout, they move to the online checkout page, just like with a normal transaction. They’ll again see the variety of payment methods available, along with their icons, including an icon for SRC. Once the customer enters the necessary card information, it gets assigned to the correct SRC system in accordance with the card network. The SRC network is the network that orchestrates the SRC process and facilitates the secure storage of card data and the ability to access that card data. The user then enters the remainder of their billing and shipping information.

After the customer enters their information, they receive a message to create a personal ID. The system then uses the ID to bind the user to the card. Oftentimes, after this step, a user must add an email address, confirm their information, and then choose whether or not to have their information retained on the device. If the user accepts, the device information will also bind to the card information to streamline the process. Once these details go through the authentication process, a customer can use that card anywhere that accepts click to pay. Now, let’s see how it works for a returning click to pay user.

Returning user journey

Returning users get a more streamlined payment experience. They’ll add items to their shopping cart and then proceed to the checkout page. Once there, they’ll see the SRC payment button on the merchant’s page and select it. When they do that, the device sends information to the SRC system to determine if the customer’s device is recognizable. If it is recognizable, the SRC system will return the saved card details. From there, the customer selects the card they’d like to use for the transaction and hits ‘continue.’ The order review page populates and displays the saved customer information. Once the user confirms this data, they can complete the order.

Since the SRC system recognized the device, the user didn’t have to provide their personal ID. If they didn’t want to save their device information, they’d be directed to a screen for ‘new user/returning user.’ If they select ‘returning user,’ they’d then see a prompt to enter their personal ID. That would lead to a one-time passcode via text or email in which the customer would then have to input that one-time passcode. Once confirmed, the customer has access to all of their saved card payment information and can complete their purchase as normal. Now, let’s look at some of the considerations for merchants like you.

Merchant considerations for SRC

To implement SRC at your business, you’ll need to do a few things. Since each of the major card brands will be working off their own SRC systems, you’ll need to connect to more than one SRC system so that your customers have access to all of the cards they’ve enrolled into SRC. As a merchant, you might choose to work with an SRC initiator who can help you integrate into various SRC systems. Initiators essentially provide code to merchants to enable SRC on their websites and manage the application programming interfaces (APIs).

Even if you support guest checkout, SRC is still a great way to provide a secure and streamlined checkout experience. It can also help keep payment card industry (PCI) data out of the wrong hands. Merchants who utilize a tokenization system for card-on-file transactions may benefit less from SRC than those who don’t.

SRC can be a great tool for your business, especially as the online transaction ecosystem is constantly changing. For small businesses like yours, protecting your business and your customers from fraud should be paramount. But, you’ll also want to weigh how utilizing SRC may deter customers from utilizing other payment methods. Then, you can make the determination on whether to implement SRC at your business.

Ready to work with a payment processor who knows small businesses like yours?

Heartland is the point of sale, payments and payroll solution of choice for entrepreneurs that need human-centered technology to sell more, keep customers coming back and spend less time in the back office. Nearly 1,000,000 businesses trust us to guide them through market changes and technology challenges, so they can stay competitive and focus on building remarkable businesses instead of managing the daily grind. Learn more at heartland.us.