Your online shopping is safer: no need to give out your card details
At Euriux Abogados, specialists in consumer law, we are starting the new decade with one of the first new developments in 2020. The European Union intends to reinforce the security of buyers on the Internet. To this end, the European Commission has been making changes to make it easier for third parties to access the infrastructure of banks through the PSD2 standard. This action is possible thanks to tools such as APIS(Application Programming Interface), a software mechanism that allows access to a multitude of platforms or operating systems, saving on R&D costs and which has enabled the expansion of companies such as Netflix.
APIS revolutionise the payment system by eliminating intermediaries, such as the merchant's connection to the credit card company, which increases security for users.
From this law, consumers will be able to authorise the merchant to execute payments on their behalf through their bank account. In addition, the system will require combining two or more previously unrequired tools (such as a linked smartphone, personal password or biometric parameters) to ensure security and prevent fraudulent transactions. Entities such as BBVA claim that this will bring with it the emergence of new methods of payment and e-commerce through the internet.
The expected implementation date has been subject to various delays in order to ensure that banks are fully aligned. However, the current moratorium period expires on 31 December 2020.
Internet card fraud
Purchases made with cards in 2018 in Spain reached almost 4 billion transactions, worth more than €147.431 billion, representing increases of 13.8% and 9.1%, respectively, over the previous year, according to the 'Annual report on the surveillance of financial market infrastructures 2018' prepared by the Bank of Spain.
The report also indicates that just over one million fraudulent card transactions were recorded in 2018, amounting to €88 million. Of the total number of fraudulent transactions, 64% corresponded to fraud in purchases made remotely, and the rest to physical POS (34%) and ATMs (2%).
