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Innovations and Payment Systems

Secure Remote Commerce: How it works, and why it exists

An explainer of the new one-click payment option recently launched by Amex, Visa, Mastercard and Discover

Summary

In October 2019, the four major credit card payment processors rolled out Secure Remote Commerce. It’s designed to simplify the online checkout process and further secure your personal information, whether it’s associated with a credit, debit or prepaid card. Here’s how it works.

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Goodbye to Amex Express Checkout, Masterpass and Visa Checkout.

Those online payment setups are going away. Say hello to something with a less-flashy name: EMV Secure Remote Commerce.

In October 2019, the four major credit card payment processors — American Express, Discover, Mastercard and Visa — rolled out Secure Remote Commerce. It’s designed to simplify the online checkout process and further secure your personal information, whether it’s associated with a credit, debit or prepaid card.

“Our goal is to create a ‘virtual payment terminal,’ which offers the same level of familiarity and confidence across remote-commerce transactions as consumers enjoy today in the physical world,” Karteek Patel, chairman of EMVCo, developer of Secure Remote Commerce, said in a June 28 news release.

Here, we answer some key questions about what Secure Remote Commerce is and how it works.

See related:  Augmented reality: Welcome to the new way to pay

What is Secure Remote Commerce?

Secure Remote Commerce is a fancy term for using one-click checkout when you’re making a purchase on a website, mobile app or any other digital channel with an American Express, Discover, Mastercard or Visa credit, debit or prepaid card. It’s meant to work on laptops, smartphones, PCs, tablets and other electronic devices.

Where is Secure Remote Commerce available?

The one-click payment system was introduced on the digital platforms of Bass Pro Shops, Cinemark Theatres, Jo-Ann Fabric and Craft, Movember, Papa John’s, Rakuten, Saks Fifth Avenue, SHOP.com and Tickets.com. Many more merchants in the U.S. will offer one-click checkout in early 2020.

“We will … work out the kinks with those merchants and then, after the holiday season, I expect to see a major pickup in the adoption of [Secure Remote Commerce],” Al Kelly, chairman and CEO of Visa, said in an earnings call on Oct. 24, two days after the new technology was unveiled.

How do you sign up for Secure Remote Commerce?

You create a Secure Remote Commerce payment profile or add a card to your profile when you visit a card issuer’s website or carry out a transaction on a merchant’s website.

A test of the sign-up process on the Mastercard website looked like this:

  • Enter your email address (which becomes your Secure Remote Commerce user ID).
  • Type in your mobile phone number.
  • Add your card number, expiration date and security code.
  • Put in your billing address.
  • Six-digit verification code is generated.
  • Profile is complete.

How do you shop with Secure Remote Commerce?

When you shop at a participating online merchant, you’ll see a one click-to-pay button rather than an array of checkout buttons. The button displays a Secure Remote Commerce payment icon paired with American Express, Discover, Mastercard or Visa logos, depending on which cards a merchant accepts.

“Often when customers shop online, they are presented with multiple payment buttons with different steps and information requirements, which can be confusing for customers and challenging for [merchants],” American Express explains on its website.

The Secure Remote Commerce icon features a pentagon design on its side with a stylized depiction of a fast-forward symbol on the right, formed by a continuous line. To the average consumer, it might look like a scrunched-up arrow.

To make a purchase, you don’t need to create an account or log into an account. Instead, you’ll simply enter your Secure Remote Commerce user ID (email address). In other words, you won’t be required to repeatedly enter your card number, expiration date, billing address, shipping address or other personal information.

“The idea behind this is to mirror the one, consistent checkout experience that exists in physical stores — with one terminal and one way to pay …. The vision for the future of digital commerce is that the new button will replace the current guest checkout process,” American Express, Discover, Mastercard and Visa said when they announced Secure Remote Commerce.

See related:  How to use cashless payment systems without overspending

What’s it like to do a Secure Remote Commerce transaction?

To test Secure Remote Commerce at an online merchant, I visited the website of the Movember charity, which promotes men’s health, to donate $10. I paid with a Mastercard that I’d just added to my new Secure Remote Commerce profile. Here’s what happened:

  • Entered first name, last name and email address on Movember website.
  • Clicked on Movember website’s “click to pay” button.
  • Secure Remote Commerce button appeared. It displayed the Secure Remote Commerce icon, as well as the logos for American Express, Mastercard and Visa. (Movember doesn’t accept Discover cards.)
  • Clicked on Secure Remote Commerce button.
  • Clicked on Secure Remote Commerce “returning user” tab. (There’s also a tab for new users.)
  • Received six-digit verification code by email.
  • Entered verification code on Secure Remote Commerce screen.
  • Prompted to type in three-digit security code for Mastercard that I’d stored in my Secure Remote Commerce profile.
  • Reviewed $10 Movember transaction.
  • Clicked “Donate” button, thereby finishing the Movember transaction.

John Egan

How does Secure Remote Commerce protect your data?

A one-of-a-kind digital identifier known as a token replaces your data, including your credit card account number, meaning this data isn’t floating around on the internet. Mastercard says this technology relies on analytics and biometrics to identify legitimate cardholders.

This process eliminates the need for merchants to store your card information — information that cybercrooks can easily swipe if one-click payment capabilities aren’t in place.

“Improved online payments security is a benefit of Secure Remote Commerce. EMV (chip) cards have become commonplace in recent years. They do a very good job deterring in-person fraud, so most of the bad guys have shifted their efforts online,” says Ted Rossman, industry analyst for CreditCards.com.

“I’m glad to see that Visa, Mastercard, American Express and other EMVco participants are deepening their online security,” he adds. “It’s also a good reminder that credit cards offer better fraud protections than debit cards.”

Why did credit card companies launch Secure Remote Commerce?

The answer boils down to one word: competition. Amazon, Apple Pay, Google Pay and PayPal already enable one-click checkout. With Secure Remote Commerce, the credit card payment processors are trying to catch up to these rivals.

A survey by PYMNTS.com, a news site that covers the payments industry, found that 70 percent of online merchants accepted one-click payments through PayPal versus less than 5 percent for the options from American Express, Mastercard and Visa.

Amazon’s patent for one-click online ordering expired in September 2017, paving the way for Secure Remote Commerce and other one-click payment methods.

“While there are already payment buttons available for use today,” American Express said in 2018, “each relies on different technical requirements and protocols, and involves vastly different steps that can lead to confusion for consumers and integration challenges for merchants.”

“Many merchants have ‘button fatigue,’ and want a single solution that enables consumers to breeze through a checkout page in a way that ensures their payment card number and other billing information is secure,” American Express added, “but doesn’t require extra steps that can slow down a transaction or lead to lost sales.”

See related:  Busted: 12 myths about contactless cards

Are there any downsides to Secure Remote Commerce?

Rossman worries that the ease of using Secure Remote Commerce might encourage consumers to overspend.

“I generally advise people against saving their payment info online to prevent impulse purchases,” he says. “Because Secure Remote Commerce relies on a single login that works across sites, it will be harder to adhere to that advice moving forward.”

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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