When is a delay not a delay?
There was hope and sighs of relief from parts of the industry about a month ago when there was some news released about Strong Customer Authentication being ‘delayed.’ We searched around for what this delay might look like and who it was coming from without a whole lot of success or clarity. It really was like Chinese Whispers among PSPs and technology providers.
The reality is that the EBA (European Banking Authority) did post an update about the enforcement of SCA under the upcoming PSD2 legislation. But in my opinion, their intent is not about creating a delay nor does their news mean that implementing SCA guidelines (and therefore technology solutions) is no longer necessary by the 14th September 2019.
No excuses people!
On the contrary, the EBA said that they believe there has been plenty of time to prepare. Due to the industry applying pressure, there is now some flexibility, but only for those who have a migration plan already in place.
“…provide limited additional time to allow issuers to migrate to authentication approaches that are compliant with SCA…and acquirers to migrate their merchants to solutions that support SCA”.
This plan needs to be executed quickly (“limited” additional time); that is the condition it seems the EBA has given ground on, so enforcement may have a grace period of weeks or months, but it looks like the leash is a short one and no mercy will be extended to those who have no plan, or whose dog ate their homework. This is where the negotiation with the local regulators will come into play and things may be different from country to country and the ambiguity may continue.
So for those of you returning from your summer holidays thinking you’ve got a bit more time on your hands now, well sorry, but that tan is going to fade pretty fast now. All I’d suggest you do is continue with plan A and communicate to your customers as best you can adhering to the original deadline because it will be them who feel the friction and pain at checkout.
Some wiggle room?
The EBA are stating “supervisory flexibility” as their term of choice, certainly something that can get easily confused through a Chinese Whisper.
NB. Chinese Whispers is a game where you stand in a circle and whisper something in the ear of the person next and they pass it on until it comes full circle and you then say out loud the phrase which will undoubtedly have become distorted in the round. If you’re reading this article and are totally bored I recommend giving the game a go in the office.