Verified by Visa is not working

Verified by Visa is a payer authentication program that allows cardholders to sign up at their issuing banks website and create a password to be used for online transactions. Once enrolled, when buying items online, buyers will be prompted to enter their password prior to completing the transaction. The merchant has to also be participating in the program otherwise you won’t be prompted for your password. It’s designed to be a consumer’s digital signature and help curb fraud losses.

I’ve always found this program interesting because in the first place, since 2002, Visa card holders get automatic fraud protection. From Visa’s site: “Use your Visa card to shop online, in a store, or anywhere, and you’re protected from unauthorized use of your card or account information. With Visa’s Zero Liability policy¹, your liability for unauthorized transactions is $0-you pay nothing.” So without any downside, why sign up?

Visa’s effort to get both merchants and consumers to sign up has been very unsuccessful to date despite trying to offer fraud protection incentives to merchants who use it and marketing it to consumers. Online merchants have been reluctant to add any more steps to the checkout process and jeopardize a sale.

Visa has been trying to tweak the rules and incentives to generate interest but I wouldn’t hold my breath. Buyer authentication is a hot area right now and there are a lot of promising technologies. I just don’t think that password authenication is going to cut it.