Visa And Mc April 1st... Rumors And Facts?

[Rolo]

So what rumors and facts do you know about the processing business comming 1st april?

Facts are that VISA and MC will release their own online security/protection systems in 2003:

MasterCard SecureCode:
http://www.mastercard.com/securecode/secur...ecode_main.html (http://www.mastercard.com/securecode/securecode_main.html)

Verified By Visa:
http://www.usa.visa.com/personal/secure_wi...ed_by_visa.html (http://www.usa.visa.com/personal/secure_with_visa/verified_by_visa.html)

But what else are in the works, which will effect how we do business?



Last edited by Rolo at Feb 25 2003, 05:10 PM

[Rolo]

Got this e-mail from one of our mainstream processors, which might explain how the new visa/mc protection systems works (btw. they do not do any adult auto rebilling, so thats why they like the new system so much):

---
Visa and MasterCard Prepare PIN-style Protection for Online Payments

Visa and MasterCard are in the latter stages of launching Verified by Visa and MasterCard SecureCode - major initiatives which promise huge reductions in online fraud by enabling cardholders to enter secret information such as a password / PIN number when paying online. This enables the cardholder to be 'authenticated' by the card issuing bank - in a similar way to the signature or PIN used in physical, face-to-face transactions, for many years.

We are preparing a new payment page so that all customers can take advantage of these revolutionary initiatives and expect to make it available in a staged rollout starting March 2003.

Visa and MasterCard want all card acquirers, globally, to implement support for this system by April 2003. As well as a huge reduction in online fraud, a huge increase to consumer confidence in online payments is expected by both Visa and MasterCard, with a related increase in online sale volumes.

Better still, Visa and MasterCard are mandating a global "liability shift" from April 2003 which places liability for some fraud-related costs with the card issuer rather than the merchant. This is a major change in favour of merchants: Visa and MasterCard are saying that once these new authentication systems are properly in place, the card issuer must take responsibility, when a cardholder has been successfully authenticated, if in fact the transaction later proves to be fraudulent.

It could be the end of online fraud as we know it.
----

So how will it look at adult sites?



Last edited by Rolo at Feb 25 2003, 05:16 PM

[cj]

i just went to that first link and entered my cc number to see if I am eligible for a password ...

it spat me back an error page, that had my local bank here in australia with a contact phone number for the branch that handles it. pretty cool ...

but is this how it will work when someone wants a wank? they have to make a phonecall to their bank first?

does it work for american's easier than that? can someone please try it?

Rolo, all I can say is that I'm glad the 3 month membership option, paid up front, has always been so popular with my female surfers ;-)

IMO the companies that this will effect the most are the high paying programs who pay per trial or even per active member. lots of old classic never fail billing/payout models are not going to work anymore.

lots depends on what happens with recurring billing options and how visa chooses to handle that, and what loop holes they forget to cover. hopefully a big mainstream company like aol tries to sue them on behalf of recurring billers everywhere ;-)

I like this part:

Better still, Visa and MasterCard are mandating a global "liability shift" from
April 2003 which places liability for some fraud-related costs with the card
issuer rather than the merchant.

[Lisa]

Verified by Visa isn't being offered by my card issuing bank at this time either...

I wonder if this will be an option, or compulsory, in terms of all online purchases. If it's just an option then the fraud problem won't necessarily be remedied on those cards that don't have it available...but if it's compulsory will it mean that those cards that don't have it will NOT be able to be used online at all?

[cj]

In stores that are not yet participating in Verified by Visa, your Visa card will continue to work as usual.

:blink:

huh? so you dont HAVE TO participate?

cool
i'll sit this one out thanks anyway visa

:P

[LadyLaw]

Originally posted by cj@Feb 25 2003, 08:31 PM
but is this how it will work when someone wants a wank? they have to make a phonecall to their bank first?

[/QUOTE]

[/quote]
CJ!!!

Calling the bank in the middle of a wank....what a "downer".
:blink: :blink: :blink:

Unless you're with the new and improved Julian...

[Hooper]

My understanding of VBV.. however out of the loop i may be is this:

1) It's optional. Not all card issuers will participate, however visa will make sure that all issuers have financial incentives to participate.

2) Just because a merchant is VBV doesnt mean they cant accept non VBV transactions, it just means that those transactions that are VBV *CANT BE CHARGED BACK*

3) It doesnt end recurring billing, rather it makes it easier for the merchant because the first transaction (e.g. the trial) is Verified and cant be charged back.. but also, that means that the surfer cant call 5 months later, claim that they never made *any* charges.. all they will be able to claim is that they didnt realize there were rebills, which will likely result in refunds.. not chargebacks.

End result... less "wife factor" more accountability to card issuers, and more "call the merchant if you have an issue with this charge". I for one cant wait.

[cj]

Originally posted by LadyLaw@Feb 25 2003, 08:46 PM
but is this how it will work when someone wants a wank? they have to make a phonecall to their bank first?



[/QUOTE]
CJ!!!

Calling the bank in the middle of a wank....what a "downer".
:blink: :blink: :blink:

Unless you're with the new and improved Julian...[/quote]
*giggle*

yeah julian can wait while i make the call ;-)))


hooper, sounds like you've summarized the 3 main points pretty darn well!

i'm looking forward to seeing the complete details on the 'financial incentives' they'll be offering to use the service. the reduction in chargebacks is definately a good move on their part.

[slavdogg]

Originally posted by cj@Feb 25 2003, 08:31 PM
all I can say is that I'm glad the 3 month membership option, paid up front, has always been so popular with my female surfers ;-)
cj, you purved women buy porn as if it was shoes :))

1:55 so far this month

[cj]

yep! and that's using ibill too! imagine if it was a real processor!!
:D

that ad seems to have done the trick :awinky:

[slavdogg]

Originally posted by cj@Feb 25 2003, 11:33 PM
that ad seems to have done the trick :awinky:
OH YEAH.

now if i could find a way to pull more of that type of traffic out of my ass i could retire in Australia :D

[cj]

got any astrology domains?
any other women's domains of any kind?

that fpa can be customized to any womens niche you can think of ;-)


(brisbane is the nicest part of australia)

:D

[The Other Steve]

Originally posted by cj@Feb 25 2003, 09:10 PM



(brisbane is the nicest part of australia)

:D
Hervey Bay looks pretty good too :)

[Lisa]

Hush Steve, I'm trying to set Slav up with CJ here...please see:

http://www.oprano.com/msgboard/index.php?a...424800791fd7462 (http://www.oprano.com/msgboard/index.php?act=ST&f=1&t=2180&s=96791539e537c5ab4424800791fd7462)

:agrin:

[cj]

Originally posted by The Other Steve+Feb 26 2003, 12:13 AM--></span><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (The Other Steve @ Feb 26 2003, 12:13 AM)</td></tr><tr><td id='QUOTE'><!--QuoteBegin--cj@Feb 25 2003, 09:10 PM



(brisbane is the nicest part of australia)

:D
Hervey Bay looks pretty good too :)[/b][/quote]
:bulb1: :bulb1: :bulb1:

steve!!!! hervey bay!!!!

ok, now i know who marie was talking about when she said 'steve' ;-)

now i'm making the connection ;-)


lisa ... shhhh ... slav can get a holiday house at hervey bay so we can go up there for girls weekends!!!

[Dravyk]

you dont HAVE TO participate?

Yes, it seems it will cut down online fraud ... BUT "you don't have to participate."

So I guess VISA/MC think the frauders will be what, the first to sign up then?!?! .... Insane!!


Calling the bank in the middle of a wank....what a "downer".

I dunno Hoop. "When one door closes, another door opens."

I thinkit's time to start signing up female tellers as phone sex operators. :P

... And another new niche is born!! :D

[cj]

Originally posted by Dravyk@Feb 26 2003, 12:28 AM
So I guess VISA/MC think the frauders will be what, the first to sign up then?!?! .... Insane!!
This, I guess, will depend entirely on what the 'financial incentives' are for using it .... or shall i say it another way ... what the 'financial penalties' are for NOT using it.

we may not HAVE to use it, but it might not be viable to not use it

[slavdogg]

who's harvey and where is this bay ??


girls weekends ?? SWEET !
how many girls ? :D

[Hooper]

I believe you have hit the nail on the head CJ... financial incentives could be a lack of negative cash flow.

[Zebra]

I found Virtumike on the front of date.com once and almost joined... almost..

[slavdogg]

Originally posted by Zebra@Feb 26 2003, 04:15 AM
I found Virtumike on the front of date.com once and almost joined... almost..
HAHAHA i remember that.

[HardProfits]

Here is all I have to offer (and some of this cannot be classified as fact or fiction ..... Yet)

1) It seems that Verfied by Visa (VBV) will be introduced in the United States from April 2003, and the progressively rolled out internationally (hence why my Aussie mates cant register their Visa Cards)

2) VBV is not compulsory, but will be offered to any Visa Cardholder who has a card with an acquiring bank that is VBV enabled

3) This wil probably mean that the IPSP's will somehow (how, I am not too sure on) allow Visa to advertise VBV during each transaction

And finally - the big one

4) I havent yet been given concrete evidence of whether or not the VBV system will require a password to be entered with each rebill yet. I have spoken with a close contact of mine in Visa, and been advised (quietly) that this may be an option, and the umpire is out on the decision.

I did ask this question of the Billing panel at InterNext, and the answers werent totally forthcoming on that one

It is obvious to me that if a surfer has to OK every rebill B4 it happens, Pay Per Join systems based on rebil income will be FUCKED :headwall:

Now I hope the IPSP's all come along now and tell me how fucked in the head I am re point 4. But I remember back to around Aug/Sep last year when I asked one of my IPSP's "will these new Visa rules affect me much"?

The answer was "nah, its just reporting stuff, which we have been doin for ages anyways, you''ll be right".

Now, those Visa changes have so far:

a, cost me about $40k in compliance costs
b, made me hire another accountant just to figure out the entire mess
c, made me have to put up with missed payments and or low payments

So c'mon the IPSP's - this time give us the full story - or just say like me "fucked if I know". At least that way we are all in the same boat

Other than that, I have fuck all to add except:

Brisbane shits all over Harvey Bay for the best place in the world to live :rokk:

Hugs to all
Daniel

[Rolo]

If rebills are going to be possible without entering the surfers pincode that is a good question. But so far I have heard that it will continue (still rumors - have not seen anything on paper to confirm it...) - well atleast until the new system is widely spread, after that anything goes (might still be possible, but they could lower chargeback rates so much that it will be very risky doing auto rebills).

I know VISA and MC needs adult sites to promote their new protection systems, and I think VISA and MC wants to be part of the online adult industry model (not good if their cards are not accepted by one of the biggest industries on the net - surfers still want to buy porn, and if they can not use their VISA or MC, then they will find other ways to pay = making way for new payment options online).

Would be nice if someone from the processors would give their input/thoughts :)

[Rolo]

What about cross border billing? More rules that would try to stop this?

[HardProfits]

Originally posted by Rolo@Feb 26 2003, 05:50 AM
What about cross border billing? More rules that would try to stop this?
Cross border acquisition is almost a major hurdle

All my URL's are registered with Visa USA, and they have a massive rebill DB on them

If I move to a Euro processor, my research so far suggests that I will ok unless I at any point exceed my CB ratios

[*KK*]

Dunno if you caught this in another thread Daniel -- but Verified by Visa is already here -- I got a popup window using a Bank of America card today -- encouraging me to sign up and create a password. It was on 1800flowers.com -- and I'm not entirely sure who launched it, the site or B of A. In any case there is the No, Thanks option at the bottom of the window and if you click that it moves seamlessly right back into the transaction.

I should mention that it's a brand new card I was using, that I've had about 3 days so I dunno if that's got anything to do with it.

As I understand VbV, rebills will work the same as they always have -- the surfer has to be notified at the time of purchase that they will be rebilled, and then he is rebilled.

The only point that seems unclear to me is whether the first VbV transaction is the ONLY one the surfer cannot charge back.

And of course in the popup window I got, there was not a damn thing in there mentioning that by going with VbV you would lose the ability to charge back.

In some ways that's a bit of a disclosure issue on Visa's part, tho it certainly bodes well for us.

[cj]

In some ways that's a bit of a disclosure issue on Visa's part, tho it certainly bodes well for us.
--


exactly ;-)
this will certainly prompt visa into taking their customers chargeback calls a little more seriously instead of just issuing it on the spot with no proof.

[homegrownmof]

This from a recent issue of California CEO:

"As part of his (Carl Pascarella, CEO of Visa USA) strategy, Pascarella is focusing on seven emerging markets, including recurrig bill payments...."

It seems to me he would not want to impede the recurring model by making people re-enter info/passwords to rebill.

[Penthouse_mike]

I spoke with our Paymentech rep in the fall of 2001, when the first few noises about VbV started. Here is a summary of what I took away from our discussion.

- VbV is optional for the card holder to enroll in
- VbV is optional for the Banks to enroll in
- VbV is optional for the merchant to support

Visa may create incentives for each party to participate, but all non-VbV transactions are unaffected by the creation of the VbV system. Thus re-bills
will be unaffected. VbV rides on top of a normal auth + settlement. (like another fraud scrub)

I think Visa has created this program in response to merchants screaming that they get the dirty end of the stick on chargebacks for non present transactions, so Visa made a system where there is another level of authenication of the card holder, and for those transactions, the banks eat the chargebacks. But in reality Visa is not fully behind it, they just want it to shut merchants up.

I think the calculation to decide if you are going to support VbV transactions is:

If surfers start expecting VbV, then what throughput will you lose from those surfers

versus

How much will it cost you to support VbV

I think the whole VbV thing is an example of the network effect. If lots of banks support it, AND lots of surfers enroll and expect it on-line AND lots of merchants support it, it can work. But without all three, it looks like it is not ready for primetime.

Last thought, I think only the most careful and paranoid surfers would enroll in VbV, and they are unlikely to be valuable customers for a membership site anyway

My 2 cents,

mike



Last edited by Penthouse_mike at Feb 26 2003, 05:24 PM

[Hooper]

Mike.. you're not just a wise man, but also a gentleman.

*subtext* send traffic please */subtext*

and i swear those are not the beggings of a young turk ;-)))

[PHmike]

Hoop,

I pm'd you a question.

[Hooper]

wow. thats a kinda cool feature of the board.. never gotten one of those before :)

I'm allergic to pollen... but thats about it ;)

[cj]

Originally posted by Hooper@Feb 27 2003, 01:15 AM
wow. thats a kinda cool feature of the board.. never gotten one of those before :)

it is huh!!
you can send an instant spam to someone based on a message they posted!!

targetted advertising at its best!

:D

[Hooper]

*working on a bot as we speak* ;-))

[The Other Steve]

CJ - quick - change your avatar.

A man should not have to see such inhuman and uncivilised signs such as that :yowsa:

[cj]

Originally posted by The Other Steve@Feb 27 2003, 03:20 AM
CJ - quick - change your avatar.

A man should not have to see such inhuman and uncivilised signs such as that :yowsa:
LOL
it could be worse ;-))))

Choose a replacement (http://www.carlajayne.com/avatars.html)

[The Other Steve]

The only avatar that could be worse is one that says

"Warnie is my hero"

:hic:

[cj]

LMAO

he only took it for weight loss purposes
poor warnie ... not much has gone right for him lately ;-)

[The Other Steve]

Originally posted by cj@Feb 27 2003, 03:10 AM


he only took it for weight loss purposes

Even better - he is a great role model for aussie youth

he took it because his mum told him too - what more could you hope for in an aussie sports icon - it brings a tear to my eye - NOT :D

[cj]

i hate cricket

they wear too many clothes

the only sport worth a purve these days is league and afl
*barf*

[Lisa]

Sigh...how can you not love cricket. :blink:

Have to say the purving was pretty good at Ballymore on Sat night...so you can add Union to that list. :awinky:

Have you seen this Warney pic? (http://www.bpalternatives.com/pics/image001.jpg) :D

[The Other Steve]

Hey - I never gave anyone permission to stick Warnie's head on my body

I'm gonna sue :grrr:

[slavdogg]

Do you guys think VbV'ed transactions will reccur better ??

If yes i can see something like this happening
affiliate programs offering higher payouts for VBV sign ups
and lower payouts for non VBV

[Rolo]

I think transactions which are verified by visa will recurre less than normal transactions. Simply because surfers who choose to enter their "pincode" are more experience than the usual "joe surfer"...

But then again it could mean less scrubbing from the processors, if the transaction is verifed by visa or mc = more signups B)