Mastercard is struggling to give smaller firms the advice they need to navigate potential post-Brexit landscapes, said Scott Abrahams, group head of acceptance and emerging payments, on the sidelines of the PAY360 conference earlier this month in London.
“[The challenge of Brexit] is important for the smaller customers because they are looking for a bit more. They don’t have a big regulation department that defines like RBS, or Barclays what goes on,” said Abrahams.
“They are as respectful, and as keen to make sure that everything is perfect, so they are coming to us for more and more advice. We do our best to provide that, but obviously when it comes to regulation we can’t, and actually there is still a lot up in the air. That’s been very tough for us to try and walk that tightrope,” he said.
Speaking about Mastercard’s support for new market entrants, Abrahams acknowledged that the firm have not always been flexible and fast at assisting emerging companies.
“New entrants need expertise, dedicated resources in some way or another. They are not the payments experts necessarily that our more traditional players would be – they have teams of people who have done more of this than Mastercard sometimes,” said Abrahams.
“They want help to scale quickly and most of that is geographical scale if you like - so they want help with how they can expand their footprint to different countries in the world. We have a dedicated single point of contact here that will help them go anywhere they want in the world with our own licensing, and also giving them advice in terms of regulation. And they want flexibility and speed, that’s probably the overriding thing that they need and expect from us.
“Most of the time we achieve that, I’d never say that we always achieve it because they guys are running at a thousand miles an hour a lot of the time, but I think that we have really become better at that in the last few years,” he said.
Mastercard is one of the founders of the global standard for chip-based Debit and Credit card transactions – EMVCO’s Three-Domain Secure (3DS) protocol.
The standard was established to give merchants and issuers a way to authenticate cardholders as they shop online.
The latest updates to 3DS 2.0 specifications were released in December 2018, with April 14 the deadline to implement 3D Secure 2.0 in Europe.
Responding to whether firms are relying on 3DS 2.0 as a replacement fraud prevention strategy, Abrahams said he respected the concerns, but the standard is supposed to be another layer of security.
“I remember when 3DS 1.0 came in and at the time banks started signing everybody up as you were trying to check-out, that didn’t work out too well. I was at Sainsbury’s at the time, and we thought if we do this, we shift liability, therefore all that other stuff that we do, we perhaps don’t need to worry about so much. And we lasted on that opinion for about two or three days, before realizing that this needs to be part of a suite of protection, and this was about the mid-2000s,” he said.
“I think personally, certainly the merchant community has learnt from that, and they have a long memory. I think they will continue to do many other things. We certainly talk about this as another layer of safety and security on top of a huge amount of existing safety and security.”