Strong Customer Authentication
1 What is SCA?
SCA (strong customer authentication) is a new European requirement created to make online payments more secure. SCA is based on the use of two or more of the following elements - categorized as knowledge, ownership and inherence:
- Something only the user knows (e.g. password, code, personal identification number).
- Something that only the user owns (e.g. token, smart card, cell phone).
- Something that the user is (e.g. biometric, such as a fingerprint).
This regulation applies to all EU-based companies that charge credit cards issued in the EU. Companies outside the EU and cards from countries other than the EU are not affected.
2 Bookings OTAs
Collecting a credit card number without SCA will no longer be a reliable means of security as the card holders bank will likely reject the transaction. Many OTAs including Booking.com and Expedia can collect guest payments at the time of booking (channel collect) with SCA. The OTA will then distribute the funds to you by bank transfer or virtual credit card so you avoid the need to deal with SCA and declined transactions. Beds24 can automatically process the virtual cards on the day the funds become available at Stripe and deposit them directly to your account. If you require security or prepayment but do not want the OTA to collect payment, you can accept bookings without card or deposit from the OTA and send a payment request to the guest from Beds24 manually or using auto actions.
3 Direct bookings
You can collect a credit card payment with the booking using SCA. If you require additional payments from EU guests you will need to send a payment request so the guest can complete the payment.
4 Payment Gateways
Paypal and Realex are taking care of the required functionality from their end.
Our integration with Stripe is fully compliant and meets the SCA authentication requirements.
5 Payment requests
Payment requests sent to the guest after booking are an alternative to collecting a credit cards. Information on how to set up payment requests is available here
You can find more information about SCA on our blog: https://blog.beds24.com/secure-psd2-compliant-payment-collection/