MasterCard SecureCode is a service that uses PIN protection for MasterCard users making online purchases. By requiring a password, unauthorized use is prevented. Read this article for a review of the services of MasterCard SecureCode.

What Is MasterCard SecureCode?

VISA developed the XML-based protocol called VISA 3D Secure to make Internet payments more secure for both credit and debit cards and both customers and merchants. VISA then licensed the protocol to other credit card companies, including MasterCard, JBC, and American Express. International vendors have selected the VISA 3D Secure protocol as the global, interoperable authenticated payment standard.

How MasterCard SecureCode Works

The cardholder begins the process of making his or her MasterCard more secure by registering his or her card through an enrollment process. The process requires the MasterCard cardholder to submit information that MasterCard already has on file to make sure that the person registering is actually the cardholder. The Signature Panel Code number (the last 3 digits in the signature panel on the back of the card) is requested to make sure that the card is physically in possession of the registrant.

During the registration process, the MasterCard cardholder chooses a password to use as his or her SecureCode and a Personal Greeting. Because the process of using MasterCard SecureCode requires a pop-up window, the appearance of the Personal Greeting is meant to assure customers that the SecureCode is being requested legitimately. An incorrect Personal Greeting is, therefore, a signal that something is wrong. MasterCard cardholders are advised not to enter their SecureCode in this case, but, instead, to call the number on the back of their card to report the situation.

When a  MasterCard cardholder visits a participating merchant (i.e., one that has enrolled in the MasterCard SecureCode program, secured a merchant plug-in through a SecureCode technology vendor, paying for setup, monthly use, and each transaction, and integrated this plug-in into their server), the pop-up window through which the Personal Greeting is given and through which the SecureCode can be entered appears during the checkout process. If the merchant is not participating, the card can still be used, but the SecureCode will not be requested. A list of participating merchants can be found here: http://www.MasterCardSecureCode.com.

Benefits of MasterCard SecureCode

Here are some benefits that may result from using MasterCard SecureCode:

• The merchant is likely to experience decreases in fraudulent charges and chargebacks.
• Consumers are likely to have increased confidence in safe credit card transactions and—research shows—are more likely to make more frequent online purchases or to start making online purchases (in the event that they do not now).
• The process is designed to be easy for the cardholder.

Issues with MasterCard SecureCode

Here are some parts of the implementation that may make MasterCard SecureCode a less than perfect experience:

• Merchants must purchase and integrate the MasterCard SecureCode Plug-in with their existing server to participate in the program. There are both set-up and ongoing charges associated with this.
• To complete the transaction, the cardholder must allow pop-up windows, a frequent conveyor of phishing and other scams, and something that many savvy web users prefer to block.
• Because different merchants choose different plug-in vendors who implement the protocol differently, cardholder’s may not have a consistent experience and may be confused and/or frustrated.
• Denial of Service (DOS) attacks, such as the one staged on December 8, 2010 in reprisal for their identification as opponents to WikiLeaks, have the potential to interrupt the 3D secure authentication system. That is, the MasterCard SecureCode system went down, and 3D Secure transactions could not be processed for a time.

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Related Article: High-Risk Credit Card Processing >>