From 14 September 2019 new regulations will require all commercial and personal card issuers to add additional authentication to their online payment systems. What must you do before that date? Soon most online card payments will be authorised by a code that’s sent to your mobile phone, ensure that all of your card issuers have your current contact number or your online transaction may be declined.

Legal changes. The EU has introduced various laws relating to e-commerce and online security. The latest comes into force on 14 September 2019 . Commonly known as Strong Customer Authentication (SCA), it will require all card issuers to add extra security checks to their online payment systems. The aim is to protect personal data and make it harder for fraudsters to access financial information.

How it works. Under the new SCA system, when a cardholder tries to make an online payment an authentication code will immediately be sent to their mobile phone. This code is then entered online to confirm that the card payment is genuine. If it isn’t, the payment will be declined. SCA applies to most payments made by personal and commercial cards, e.g. company credit cards, but some payments will be exempt. For example, you should be able to make up to five payments under £27 before being asked to authenticate a payment (your card issuer may have tighter rules).

Potential problems. Experts are warning that many card issuers are unprepared for SCA as they don’t have up to date mobile numbers for their cardholders. This means that authentication codes won’t get through and purchases will be declined. This could cause problems in the first few months. Our advice is to contact all your card issuers to confirm they have your current number (if they haven’t contacted you already). If you live or work in an area with poor mobile reception, ask your card issuer to send authentication codes via e-mail instead.

Tip. If your business accepts online payments, you aren’t legally required to do anything. However it’s probably worth adding information about SCA to your online payment page and reminding potential customers about the new enhanced security checks.