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Payments are a key part of the shopping experience, no matter where and what you’re selling—but they’re especially important online, where trust and security are top of mind.
\nIf you operate in the European Economic Area (EEA), you may have heard about the revised Payment Services Directive (PSD2). It’s a regulatory requirement that includes Strong Customer Authentication (SCA) and is intended to increase protection against fraud for online purchases and will have some impact on businesses in the EEA.
\nAhead, learn how to navigate these complexities of selling so you can focus on running and growing your business. This article answers all the questions you might have on PSD2, SCA, and more.
\nTable of Contents
\nStrong Customer Authentication is a security policy in the EEA that helps reduce fraud and make payments more secure. It is part of the revised Payment Services Directive.
\nSCA is similar to what many people refer to as two-factor authentication: if a customer is buying online using their debit or credit card, SCA may require them to use two forms of authentication.
\nAs an example, instead of just entering their PIN or password, SCA might prompt a customer to enter a code texted to them as a second step. This makes it harder for fraudulent transactions to get through.
\nSCA also helps ensure that a breach of one authentication item doesn’t compromise another method of authentication, furthering the overall security of the customer’s information.
\nThe revised Payments Services Directive regulates electronic payments made in the European Union. The first Payments Services Directive came into effect in 2007, and PSD2 was released in late 2019—although it wasn’t fully implemented until the end of 2020.
\nOne of the major updates this revision brought to the table was stronger protection for customers who shop online using their debit and credit cards. This also protects you as an ecommerce merchant.
\nTo comply with these regulations, you’ll need to make sure you have Strong Customer Authentication to help mitigate card-not-present fraud from payments accepted from European buyers.
\nStrong Customer Authentication must include two of these three elements: knowledge, possession, and inherence.
\nKnowledge refers to something that only your customer would know. A few examples of this include:
\nPossession refers to items the customer physically owns. This includes things like:
\nInherence refers to things that are inherently the customer—personal and physical identifiers that no one else can fit. It’s referred to as “something the customer is.” Examples are:
\nIn the past, access to accounts and payment authorization could be done with a simple “something the customer knows”—like a PIN. SCA requires more than that, ensuring even better security.
\nPasswords can be leaked or hacked. Credit and debit cards can be lost or stolen. But if someone is required to input a password from their specific device or provide a fingerprint scan alongside their credit card PIN, it makes the entire process much more secure.
\nSCA is done through a protocol called 3D Secure—a technology that is supported by most European cards. This protocol adds an extra layer of security that customers have to enter during checkout to authenticate themselves.
\nYour customers will see the 3D Secure indicator show up on orders and it will then prompt them to further authenticate themselves with a multifactor authentication process.
\nThis could be:
\nThe fact that many smart devices are compatible with these types of inherent authentication helps make it even easier for customers to make secure purchases.
\nOnce this SCA step has been completed, any fraudulent chargebacks are the bank’s problem—not yours.
\nIf your business operates within the EEA, you need to be compliant with PSD2 and SCA, or banks can decline purchases. However, it’s not difficult to make sure you’re compliant—you simply have to do one (or both) of two things:
\nHaving a Shopify store makes it easy to be compliant. With the number of payment options you can add, you can easily ensure 3D Secure is automatically applied to purchases made in the EEA.
\nUsers are also able to see orders that have used SCA for payment processing within their Shopify orders page. Orders paid with debit or credit cards that have gone through 3D Secure will have 3D Secure (3DS) noted beside the order timeline.
\nThis means the buyer’s identity has been confirmed by the bank who issued the card, and the transaction will default to low risk. There is no action required for the merchant within the orders page for these transactions.
\nSCA applies to all online payments made within the European Union. This means the customer resides within the EU and has made a purchase from a business that also operates in the EU.
\nHowever, more and more countries are moving toward similar requirements in order to prevent fraudulent payments and protect merchants and payment providers.
\nNot every electronic payment or ecommerce transaction is subject to SCA. Here are some examples of when SCA isn’t required.
\nLow-risk transactions are pinpointed through a transaction risk analysis (TRA). Payment providers are able to conduct real-time risk analyses to decide whether or not SCA needs to be applied.
\nThis risk is determined by the payment provider’s fraud rates. They may be exempt if their fraud rates are below these thresholds:
\nThe payment provider can then request a “TRA exemption” to bypass the need to use SCA.
\nLow-value transactions, or transactions that don’t cost a lot, may also be exempt from SCA. The regulations dictate that any transaction of €30 or less can be considered a low-value transaction.
\nHowever, the issuing bank or card provider keeps track of the number of times this exemption is used. SCA will be required after every five low-value transactions to ensure the payments are secure and intentional so fraudsters can’t get around PSD2 regulations.
\nA recurring transaction, or a fixed-amount subscription, is another exemption. SCA will be required for the first payment, but subsequent automatic payments for subscriptions will be exempt from these security requirements.
\nMerchant-initiated transactions (MITs) are considered to be “out of scope” rather than exempt. However, marketing a transaction as an MIT is typically a similar process to requesting an exemption.
\nThis type of payment uses a card that’s already on file. As with recurring transactions, the first payment must go through Strong Customer Authentication. However, additional payments do not, typically because the customer has agreed through a contract or other policy that the transaction is verified.
\nMOTO transactions, or mail order and telephone order transactions, are also considered to be out of scope. As these types of payments are not considered to be electronic or online payments, they don’t fall under the SCA requirements.
\nCorporate or B2B transactions are those that occur between two corporations. When this payment is made with a card that is specified for corporate transactions, these payments are also exempt from SCA requirements.
\nInter-regional transactions are transactions that are made by consumers who do not live within the regions or parameters of the PSD2 regulations and are therefore out of scope of SCA requirements.
\nFor example, even if your business is located within the EU, if someone from the United States is making a purchase, that transaction is out of the scope of SCA.
\nLastly, customers themselves are able to essentially whitelist companies that they regularly work with or trust so their payments no longer need to be authenticated. The consumer’s bank will then keep track of this list of “trusted beneficiaries” so the consumer can skip the SCA process.
\nIf you’re using Shopify Payments to process credit or debit cards in Germany, Denmark, Ireland, the Netherlands, Austria, Belgium, Sweden, Spain, or the United Kingdom, you don’t need to do anything—you’re automatically compliant.
\nShopify Payments is optimized to minimize the use of 3D Secure. It will only use 3D Secure when absolutely required by the issuing bank in order for a transaction to be authorized.
\nIf you’re using Stripe to process credit or debit cards, you’re also fully compliant with PSD2 and able to offer SCA.
\nLocal payment methods such as iDeal and Klarna, and wallets like Google Pay, Apple Pay, and PayPal Express, are already compliant with the regulation and require no action.
\nFor merchants using third-party gateways, you’re not automatically in compliance with PSD2.
\nTo be in compliance, we recommend you use a Shopify-approved SCA gateway and create a connection with Cardinal Commerce. You’ll be prompted within your Shopify admin in Settings > Payments that Cardinal Commerce is available.
\nIf you’re operating in countries in the EEA or EU, it’s in both yours and your customers’ best interest to ensure you’re compliant and that you offer 3D Secure options, or that the way you take payments is exempt from SCA.
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Strong Customer Authentication, or SCA, is required any time a payment is made by a consumer residing within the European Economic Area (EEA). While there are exemptions, businesses that operate within the EEA should ensure they’re compliant, regardless.
\nThese laws are in place for banks. This means that the bank cannot (and should not) approve transactions that do not go through SCA security, or else they’re in violation of European law. However, this also means that if you aren’t SCA compliant, banks will likely decline the transaction, meaning consumers that reside within the EEA are unable to shop with your business. This can hurt sales, so it’s in your best interest to ensure compliance.
\nThe European Banking Authority (EBA) within the European Union (EU) is responsible for enforcing SCA. In the UK, PSD2 SCA regulations are enforced by the Financial Conduct Authority (FCA).
\nA PSD2 license is required by payment institutions in the EU. These include Stripe, PayPal, Square, Apple Pay, Google Pay, and others. These types of companies will have licenses so they can provide payment services that are compliant with PSD2 guidelines.
\nhttps://www.shopify.com/blog/strong-customer-authentication
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A new AI service for “parsing” music tracks.
\nThe Mikrotakt neural engine can split any track into vocals, instrumentals, bass, drums, and other audio tracks.
\nIn addition, you can upscale vocal tracks to clean up the voice and adjust the pitch. This feature is ideal for musicians and content makers.
\nThe new Chinese model DeepSeek-V3 becomes a competitor to ChatGPT:
\n– registration requires only your email and password
\n– the neural is quite fast: answers are generated in seconds
\n– Thinking mode, where AI turns into an academic on any topic
\n– the model can read diagrams and generate any texts
\n– files of different sizes can be uploaded
\n– the neuron is good at working with code
\n– absolutely free
\nHailuo AI from China can clone any voice without censorship in a few seconds. Its library includes more than 300 voices in different languages and intonations. The model also allows for full customization: you can change the tone, speed, and timbre and add sound effects.
\nThe Chinese have released a worthy competitor to ChatGPT.
\nThe Qwen2.5-Plus chatbot provides accurate answers, can read documents and images, and is completely free of charge.
\nKrea allows rotating models in its “Photoshop”
\nKrea developers have come up with an incredible feature for their neuro-Photoshop: you can drop any object and edit its position in 3D space.
\nThe Upscayl neuron has received a 16x upscale, so now it can save even the most hopeless photos. The download is free.
\nThe Wegic neural network has become even cooler.
\nNow websites are generated in seconds, and all your edits can be made with simple queries.
\nYou just throw in a promo and you have a perfectly(?) designed website.
\nA working AI meme generator.
\nThe Brainrot neuron follows trends, selects relevant images, and produces memes that are even funny to read. And all this is free.
\nGoogle has released a top free guide to AI agents.
\nIt contains everything: basic knowledge, tools, architecture, training methods, and a step-by-step recipe for creating agents on LangChain and LangGraph.
\nIt is a cool service for learning languages with an AI interlocutor.
\nThe Lingocat neuron imitates the native speaker, gives feedback, and has tasks to improve skills. And all this is free of charge.
\nThe free neural from the Chinese outperforms(?) ChatGPT.
\nA new model called R1 has been released that outperforms the best version of ChatGPT. R1 is twice as powerful as the previous version and it has literally everything you need: programming, math, rewriting, and everything else. It’s worth noting that if you look at the graph of how it “outperforms”, it doesn’t encourage you to switch from OpenAI to the Chinese neural.
\nUniversal AI photo editor.
\nGenerating, replacing, or deleting details, styling, changing the background, and upscaling – and this is not the whole list of functions of the new and free Dzine neural.
\nPrompt generator for ChatGPT
\nPromptEngine works according to the official recommendations of OpenAI. The service also supports other language models: Claude, Gemini, LLama, and Mistral, which can be selected from a list.
\nOpenAI President showed a feature for the o1 model.
\nAccording to Greg Brockman, the o1 model works a bit differently than other types of AI, and to achieve high performance, you need to follow a certain plan in writing promos:
\nthe goal, response format, warning, and context.
\n(The Anatomy of an o1 Prompt attached an example image)
\nChatGPT can now write first.
\nThe neuron will remind you of important things like a real assistant. For example, in the morning, it can provide a ready-made excuse for being late for work, and in the evening, a convincing explanation for a deadline shift.
\nSo far, only 10 regular tasks are available, but by the end of the week, all paid users will receive the new feature.
\nOpenAI offers free tokens for ChatGPT.
\nHowever, there is a caveat: in exchange, they ask for permission to use your promos to train models.
\nThe offer lasts until the end of February. Pro users can get up to 1 million tokens per day, and mini-version users can get up to 10 million!
\nTrump has canceled Biden’s decree on control over AI development.
\nThe document, signed in 2023, required developers to share test results with the government to reduce risks. However, Republicans insisted that this restricted freedom of speech and hindered progress. Now, AI development is unrestricted again.
\nChina will organize a competition between robots and humans
\nIn April, China will host the world’s first half marathon where people will compete with robots. The race will involve 12,000 runners and dozens of androids. Technology versus biology is a real race of the era.
\nAI tokens soar after the Stargate project announcement.
\nOn January 23, Trump announced a $500 billion investment from the private sector in the development of AI infrastructure in the United States. As part of this project, OpenAI, SoftBank, and Oracle will create a joint venture called Stargate. Immediately after this announcement, the AI and big data token market showed significant growth:
\n– AI16Z and AI Rig Complex (ARC) grew by 30% per day
\n– GRIFFAIN and ZEREBRO tokens doubled in price
\n– MetamonkeyAi (MMAI) showed an increase of 152.25%
\n– FLock.io (FLOCK) – by 57%
\nThe smartest o3-mini model will be free!
\nSam Altman said that this neural will be able to solve complex problems in programming, math, and data analysis – all for free.
\nFeatures of o3-mini:
\n– advanced analytical abilities
\n– accelerated data processing speed
\n– ease of use for everyone
\nThe release is planned for the near future.
\nOracle founder supports AI totalitarianism
\nBillionaire Larry Ellison stated that the total surveillance system with artificial intelligence based on cameras, drones, and police recorders will force citizens to “behave in the best way possible”.
\nOracle has recently entered into a partnership with OpenAI and Softbank. Digital dystopia is becoming a reality.
\nThe first Chinese base for robot training was opened in Shanghai
\nThey will learn to help around the house, play football, and assemble cars.
\nThe data obtained in the process will be shared with various companies.
\nCurrently, the center has more than 100 androids and plans to expand to a thousand by 2027.
\nChatGPT can now create any kind of application – a new Canvas feature has been released that runs the code right in the browser.
\n– There are no limits to ideas – we invent and ask AI to draw up a detailed project description.
\n– Copy and paste the request into the chat with the neuron, but add the “/canvas” command at the end.
\n– AI will produce a fully working application in React and HTML in a second – you can test it right away!
\n– There are no limits or restrictions – you can even clone YouTube in your browser.
\nThe feature is free.
\nTop 5 promos for working with any amount of information – the neural will squeeze out all the “water” from the source and give you only concise, verified facts:
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