3D Secure Pay Authentication Market Forecasts to 2028 – Global Analysis By Type (Access Control Server, Merchant Plug-in and Other Types), Component (Solution and Other Components), Application and By Geography
According to Stratistics MRC, the Global 3D Secure Pay Authentication Market is accounted for $1.05 billion in 2022 and is expected to reach $2.46 billion by 2028 growing at a CAGR of 15.3% during the forecast period. 3D secure authentication is a fraud-prevention security system for credit and debit card transactions processed online. During card payments, 3D secure authentication adds an additional layer of security. It provides clients with a safe authentication step before they can shop online, assuring that they are using the appropriate card details and minimizing the risk of card payment fraud. Fraudulent online activities, such as identity fraud and unauthorized card use, are greatly reduced when using 3D secure authentication. It protects the cardholder's personal details and increases customer trust. With 3D secure authentication, one can check if a buyer is an authorized cardholder.
According to PaymentsCM LLP, as of 2019, the global average acceptance rate of 3D secure is 70%. Furthermore, the development of the 3D secure technology by upgrading it to 3D secure 2.0 has resulted in decreasing cart abandonment rates.Market Dynamics:Driver:
The primary purpose of 3D Secure Pay Authentication is to provide an additional layer of security for online transactions, specifically targeting card-not-present fraud. By implementing this authentication method, businesses can reduce the risk of unauthorized access and fraudulent activities, protecting both themselves and their customers. Additionally, it involves a two-factor authentication process, combining something the user knows (e.g., a password or PIN) with something the user possesses (e.g., a mobile device or card). This approach strengthens the authentication process, making it more difficult for fraudsters to gain unauthorized access to sensitive payment information, which will accelerate market growth over the course of the forecast period.Restraint:
Potential for false declines
False declines occur when legitimate transactions are mistakenly flagged as fraudulent and declined. This can lead to frustration and inconvenience for users who are unable to complete their intended purchases. The additional steps and authentication processes involved in 3D Secure Pay Authentication increase the likelihood of false declines, negatively impacting the user experience and potentially leading to cart abandonment. Additionally, false declines can result in lost revenue for businesses. When valid transactions are declined, customers may choose to abandon the purchase altogether or switch to a different payment method, impacting sales and conversion rates.Opportunity:
Increasing online transactions
The e-commerce market has been experiencing rapid growth globally, driven by factors such as increasing internet penetration, smartphone adoption, and changing consumer behavior. This expansion in online retail creates a vast opportunity for 3D Secure Pay Authentication to be implemented as a reliable and secure payment authentication solution for online transactions. Morevoer, With the rise of online transactions, the risk of fraud and unauthorized access increases as well. 3D Secure Pay Authentication provides an effective measure to combat fraud by adding an extra layer of verification. This enhanced security helps businesses protect themselves and their customers from fraudulent activities, fostering a safer and more trustworthy online environment are driving the growth of the 3D Secure Pay Authentication market over the forecast period.Threat:
Evolving cyber security threats
As technology advances, cybercriminals continuously develop new and sophisticated attack techniques to exploit vulnerabilities in payment systems. This poses a threat to the effectiveness of 3D Secure Pay Authentication as fraudsters may find ways to bypass or compromise the authentication process, undermining its purpose and compromising the security of online transactions. Furthermore, data breaches can have severe consequences for both businesses and consumers. If the authentication systems or databases storing sensitive customer information within the 3D Secure Pay Authentication ecosystem are compromised, it can lead to unauthorized access, identity theft, and financial fraud. The reputational damage resulting from data breaches can erode trust in the authentication system and hinder its widespread adoption, which will impede the market growth.Covid-19 Impact:
The COVID-19 pandemic has positively impacted the 3D secure authentication market. As a result of the COVID-19 outbreak, the U.S. became the world's worst-affected country in 2020, prompting governments to implement a number of restrictions on enterprises in the country in an effort to stem the disease's spread. But the closure of enterprises and public events has had no direct influence on the market, as the adoption of e-commerce channels has increased exponentially throughout the epidemic, resulting in a surge in online payment methods. This in turn is anticipated to create significant opportunities for the 3D secure authentication market during the forecast period.
The Banks segment is expected to be the largest during the forecast period
During the anticipated timeframe, the banks segment's market share will expand significantly. The greatest revenue share was reported for the banks segment. The segment's expansion can be attributed to the banking industry's growing digitalisation. According to Bankrate, LLC, approximately 65.3% of Americans utilize digital banking services as of September 2022. Therefore, there is a growing requirement for fraud protection in the banking industry as more digital banking and online card transactions are used. Additionally, 3D secure payment authentication gives banks access to consumer transaction history, behavioural history, and device information.
The Access control server segment is expected to have the highest CAGR during the forecast period
Over the projection period, the access control server segment is predicted to develop at the fastest rate. Issuing banks process cardholder authentication needs using the access control server. A rise in the demand for identity verification during the processing of digital transactions as a result of an increase in identity fraud is one aspect that can be expected to contribute to the expansion of the access control segment. Furthermore, by allowing cardholders to confirm their identity using a password they choose themselves, the access control server software module gives credit card transactions an extra layer of security. Several businesses, including AsiaPay Technology, Worldline, and GPayments Pty. Ltd., among others, are providing the solution, which is fostering the expansion of the global market.Region with largest share:
The highest revenue share was contributed by North America, which led the market globally. Card Not Present (CNP) scams are on the rise in North America, which is the cause of the growth. In order to combat CNP fraud, retailers all around the United States and Canada are progressively implementing 3D secure payment authentication. For instance, 3DS secured almost 37% of all CNP transactions in America, up from just 10% in Q3 2020, according to Paypers BV. Furthermore, a significant contributor to the growth of the region is the market hegemony of companies providing 3DS solutions in the area, which is driving the demand for 3D Secure Pay Authentication in the region.Region with highest CAGR:
Asia-Pacific is expected to witness the fastest growth rate over the forecast period. Countries such as China, India, Japan, and Singapore are adopting authentication technology within their territories. The rising demand for digital transformation in banks has led to an increase in the use of 3D secure authentication in Asia. In the Asian market, the introduction of real-time payments has resulted in a drastic rise in payment fraud, with four in five APAC banks experiencing an increase in losses. Moreover, regulatory changes and individuals aimed at facilitating adoption of open banking are also resulting in digital banking fraud.Key players in the market:
Some of the key players in 3D Secure Pay Authentication Market include Adyen N.V., American Express Company, AsiaPay Limited, Bluefin Payment Systems LLC, Broadcom Inc., Cardknox Development, Inc., Decta, Discover Global Network, Elavon Inc., ENTERSEKT, Fiserv, Inc., GMO Payment Gateway, Inc., GPayments Pvt. Ltd., iZealiant Technologies Pvt. Ltd., JCB Co., Ltd., Marqeta, Inc., Master card Incorporated, Modirum, mSignia, Inc, Netcetera, Qualcomm Technologies, Inc., Ravelin Technology Ltd, RS Software, SIA S.p.A., The American Express Company, UL, LLC, UnionPay International, Visa Inc. and WorldlineKey Developments:
In May 2021, Netcetera and Nok Nok Labs entered a partnership to offer delegated authentication solutions to merchants and payment providers for addressing PSD2-SCA and 3DS 2.x protocols compliance.
In January 2021, Omise, a payment service provider, executed the Netcetera 3-D Secure Server for secured online payment transactions in the APAC region, making Omise one of the first PSP customers to implement EMV 3DS 2.2 protocol.
In August 2019, mSIGNIA and Signifyd partnered to create a new generation of secure payment services for PSD2 strong consumer authentication (SCA) and guarantee more payments using an analytically enhanced, EMV 3DS compliant merchant environment.
• Access Control Server
• Merchant Plug-in
• Other Types
• Merchants & Payment Gateway
• North America
o Rest of Europe
• Asia Pacific
o New Zealand
o South Korea
o Rest of Asia Pacific
• South America
o Rest of South America
• Middle East & Africa
o Saudi Arabia
o South Africa
o Rest of Middle East & AfricaWhat our report offers:
- Market share assessments for the regional and country-level segments
- Strategic recommendations for the new entrants
- Covers Market data for the years 2020, 2021, 2022, 2025, and 2028
- Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
- Strategic recommendations in key business segments based on the market estimations
- Competitive landscaping mapping the key common trends
- Company profiling with detailed strategies, financials, and recent developments
- Supply chain trends mapping the latest technological advancements