PayU Launches 3DS2 SDK for Indian E-Commerce

Indian payment aggregator PayU to offer 3DS2 software development kit (SDK) for all domestic and international transactions to resolve the issues of transaction security and speed

PayU Launches 3DS2 SDK for Indian E-Commerce

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Online payment service provider PayU, which enables local and cross-border payments and innovative financial services across 50+ emerging markets, launched a 3DS2 software development kit (SDK) for merchants on its platform to authenticate payments in compliance with the Indian security mandate to become effective in October 2023.

3D Secure framework was established in 2003 by all major networks: Visa, Mastercard, American Express, and Diners to better safeguard businesses against payment fraud. It enabled card transactions to finalize only after an additional authentication step was completed by the cardholder.

3D Secure 2.0 or 3DS2 is an upgraded version of the earlier framework that provides an opportunity to skip the Additional Factor of Authentication (AFA) by completing an intelligent risk-based authentication.

3DS2 security protocol has numerous benefits over the first version since early authentication requirements didn’t cover the scope of mobile payments available today. Its improved design enhances the user experience on mobile devices by being fully compatible with mobile wallet applications and in-app transactions. Thus, 3DS2 introduces “frictionless authentication” and improves the purchase experience compared to 3D Secure 1.

India’s e-commerce market is quickly growing, yet security imperfections cause significant money losses. In 2022, financial fraud cost the Indian banking industry INR 6,500 crore.

The official introduction of 3DS2 authentication in 2020 has already reduced fraud by 57% and decreased abandonment rates by 70%.

PayU’s 3DS2 SDK will provide merchants with a higher level of security across both domestic and international transactions. The solution was developed through collaboration with the full-stack payment technology company Wibmo.

Nina Bobro

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Nina is passionate about financial technologies and environmental issues, reporting on the industry news and the most exciting projects that build their offerings around the intersection of fintech and sustainability.