How 3-D Secure Protects Merchant Revenue From First-Party Misuse
The digital commerce landscape is facing a crisis of First-Party Misuse (FPM), also known as "Friendly Fraud.” First-party misuse now accounts for nearly half of all chargebacks, yet merchants win less than 20% of these disputes once they are coded as fraud.
As First-Party Misuse (FPM) begins to dominate the chargeback landscape, merchants can no longer rely on legacy prevention methods. Simultaneously, fraud trends indicate that in the AI era, card-not-present (CNP) fraud and eCommerce chargebacks will only continue to rise. Authentication and authorization can no longer be treated as separate steps, but rather as a single, data-driven decision.
In this webinar session, merchants will discover what makes modern EMV 3-D Secure so powerful against FPM and why the protocol has become the gold standard to protecting margins against chargebacks and rising fraud trends.
Learning Objectives:
- Learn why modern EMV 3-D Secure (3DS) is one of the most effective countermeasures to reducing chargebacks from FPM and cardholder disputes, reducing chargeback ratios and stopping disputes before they hit merchant accounts
- Learn how 3DS shifts financial liability for Card-Not-Present (CNP) fraud from the merchant to the card issuer
- Discover how modern EMV 3DS uses risk-based authentication to allow frictionless transactions for legitimate users while challenging only high-risk attempts
- Understand how 3DS leverages rich data -- including device IDs, behavioral insights, and account history – to prove a cardholder’s involvement, and reverse disputes through Visa and Mastercard’s latest trust programs
- Understand how metadata exchange via 3DS improves issuer confidence, leading to fewer false declines, higher approval rates, and less friction for customers
- Learn how FPM programs operated by the major card networks leverage the EMV 3-D Secure protocol to reverse first party chargeback disputes “in-network” when the merchant has provided EMV 3-D Secure-based data elements on prior good (non fraud) transactions by the cardholder as compelling evidence
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