CBI contributes to major lobbying breakthrough on Strong Customer Authentication

The CBI worked with UK Finance, the British Retail Consortium, FSB, IOD, Vendorcom and key retail and ecommerce members, to ensure the UK’s Financial Conduct Authority (FCA) fully understood the potential economic impact if they insisted on full regulatory compliance on 14 September.

This is a major lobbying breakthrough on Strong Customer Authentication (SCA) - technical payments measures to tackle online fraud - that were set to cause major economic disruption this year. It had been estimated that an insistence on full compliance on 14 September could have seen about one third of ecommerce transactions declined in the UK.

These standards will apply to card transactions where the customer is not present and for contactless card transactions. These measures are designed to tackle online fraud, but they are shaping up to be complex.

This collaboration secured the FCA’s agreement to find a route to a period of forbearance to mitigate such economic risks. We believe that this strong UK position paved the way for action at EU level, and on Friday 21 June, the European Banking Authority stated that authorities in Member States can set their own forbearance periods beyond the hard deadline.

This will ensure that CBI members across a number of sectors, including retail, travel, leisure and hospitality, do not face the risk of revenue losses.

Needless to say, the battle continues as the European Banking Authority's (EBA) approach on this forbearance will generate issues regarding fragmented approaches across the EU’s digital single market. As such, we are now working with Business Europe to try and get a uniform approach across the EU28.

If you would like to get involved with our work on this important matter, please get in touch.