European Patent for PSD2 Strong Customer Authentication & KYC
EPO Patent for PSD2 SCA & KYC
- European Patent Office (EPO) has issued notice of intention to grant patent across more than 38 countries
- Payment Service Directive 2 (PSD2) Strong Customer Authentication (SCA) compliance day was 14th September 2019
- Patent includes methods for SCA and Know Your Customer (KYC)
- iSignthis Patents augment 3DSecure Version 1 for compliance to PSD2 SCA
- iSignthis SCA already incorporated into Paydentity(TM), ISXPay(R) and Probanx(R)
The notice of intent to grant patent coincides with the European Union's Directive requiring Strong Customer Authentication (SCA) under the Payment Services Directive 2 for i) cards and ii) access to account services, effective from the 14th September 2019. Many national regulators have recently extended the effective date for cards SCA by up to 18 months due to the difficulty faced by the payments industry in implementing an effective SCA process. Whilst the card schemes have been advocating the use of EMV Co's 3DSecure Version 2, the payments industry in the EU has not been prepared for the 14th September date, leading to the extension by EU national regulators.
The patent provides a means for iSignthis to independently achieve compliance with the European Banking Authority's (EBA) Regulatory Technical Standard (RTS) on SCA, and authentication approaches outlined in the EBA's June 2019 opinion.
Consumers purchasing electronic money from our European Economic Area Authorised Monetary Financial Institution, iSignthis eMoney Ltd ("ISEMEE") subsidiary, will have available to them several means of authenticating their payment, allowing for a seamless consumer experience that in most cases will also meet the customer due diligence or KYC requirements at the same time.
ISEMEE thus has flexibility in its approach to SCA, including i) use of 3DSecure Version 2 when it becomes widely available, or ii) overlaying its patented technology on top of the existing 3DSecure Version 1 to ensure that that is PSD2 SCA compliant, or, iii) using its patented technology stand alone to simultaneously perform both KYC and SCA, and on success storing the consumers card on file and subsequently initiating transactions from the stored card without the requirement for further SCA on latter transactions. This last method leads to a significant reduction in friction for our consumers, as SCA and KYC will be performed in a single step with far less online click interactions, allowing rapid onboarding to ISEMEE's www.Flykk.it electronic money service.
Open banking access is a separate PSD2 requirement from that of SCA for cards. Accordingly, Probanx Solutions Ltd has built its API Specifications based on European Standards and industry guidelines by the UK's Competition and Markets Authority (CMA) - Open Banking Implementation Entity (OBIE). The primary API and the Contingency measure have been deployed by ISEMEE, allowing third party providers to access ISEMEE systems for payment initiation and account information services.
About iSignthis Ltd
Australian Securities and Frankfurt Stock Exchange listed iSignthis Ltd (ASX:ISX) (FRA:TA8) is the global RegTech leader in remote identity verification, payment authentication with deposit taking, transactional banking and payment processing capability. iSignthis provides an end-to-end on-boarding service for merchants, with a unified payment and identity service via our Paydentity(TM) and ISXPay(R) solutions.
By converging payments and identity, iSignthis delivers regulatory compliance to an enhanced customer due diligence standard, offering global reach to any of the world's 4.2Bn 'bank verified' card or account holders, that can be remotely on-boarded to meet the Customer Due Diligence requirements of AML regulated merchants in as little as 3 to 5 minutes. Paydentity(TM) has now onboarded and verified more than 1.5m persons to an AML KYC standard.
iSignthis Paydentity(TM) service is the trusted back office solution for regulated entities, allowing merchants to stay ahead of the regulatory curve, and focus on growing their core business. iSignthis' subsidiary, iSignthis eMoney Ltd, trades as ISXPay(R), and is an EEA authorised eMoney Monetary Financial Institution, offering card acquiring in the EEA, and Australia.
ISXPay(R) is a principal member of Visa Inc, Mastercard Inc, Diners, Discover, (China) Union Pay International and JCB International, an American Express aggregator, and provides merchants with access to payments via alternative methods including SEPA, Poli Payments, Sofort, Trustly, WeChat, AliPay and others.
UAB Baltic Banking Service, a wholly owned subsidiary of iSignthis Ltd, provides API based access to SEPA Core, SEPA Instant and SEPA business scheme, for neobanks, banks, credit unions and emoney institutions, and provides a bridge to the Central Bank of Lithuania's CENTROLink service.
Probanx Information Systems Ltd (Probanx(R)), a wholly owned subsidiary of iSignthis Ltd, is an international banking software company which has been serving the banking industry since the year 2000 by developing comprehensive banking software solutions to financial institutions around the globe. Probanx offers web-based banking solutions using the latest technology and international standard business rules. Our customers are located on five continents and supported from our technical centres in Europe and Australia.
iSignthis' Probanx delivers core banking software, including a fully comprehensive and versatile banking solution for retail, corporate and private banks, emoney and payment institutions, offering capabilities that up until now were affordable only by large commercial banks.
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