The global cart abandonment rate for ecommerce sites is estimated to be over 70%, according to the Baymard Institute. This means as many as 7 out of 10 ecommerce users add a product to their cart and then leave a site without making a purchase.

There are various reasons for cart abandonment, such as a user’s preferred payment method being unavailable, shipping costs making the total higher than the user expected, or a long checkout process. 3D Secure, first implemented by card networks in 2001 as 3D Secure 1.0, can also cause cart abandonment.

According to the Ministry of Economy, Trade and Industry (METI), the introduction of a new version of 3D Secure—3D Secure 2.0—will become mandatory for all ecommerce businesses by the end of March 2025 as a “countermeasure against fraudulent use” of credit cards. This article discusses the relationship between 3D Secure and cart abandonment, how businesses can implement 3D Secure 2.0 while avoiding cart abandonment, and more.

What’s in this article?

• 3D Secure and shopping cart abandonment
  
• Reasons 3D Secure increases cart abandonment rates
  
• Will 3D Secure 2.0 improve cart abandonment rates?
  
• How to prevent shopping cart abandonment after implementing 3D Secure
  

3D Secure and shopping cart abandonment

The percentage of users who leave a site without purchasing a product is called the “shopping cart abandonment rate” or “cart abandonment rate.” A high abandonment rate means that many users are leaving a site without making a purchase, which can result in lost sales opportunities and reduced revenue. Cart abandonment occurs frequently on many ecommerce sites.

As explained at the beginning of this article, there have been many cases of shopping cart abandonment overall. And with a potentially longer checkout process, 3D Secure 1.0 could have been a contributing factor in cart abandonment, so expectations for 3D Secure 2.0 are increasing. However, even with 3D Secure 2.0, the problem of cart abandonment has not been eliminated.

METI has announced that the implementation of 3D Secure 2.0 will be mandatory for all ecommerce businesses by the end of March 2025. As the adoption of 3D Secure becomes more widespread, it is more important than ever for businesses to take appropriate measures to avoid cart abandonment.

Reasons 3D Secure increases cart abandonment rates

It can be time-consuming and inconvenient

Shoppers want the buying process to be as smooth as possible. The introduction of 3D Secure can make it more time-consuming to complete a purchase, which might feel like a hassle to customers.

It is not uncommon—especially for busy people—to want to avoid complicated processes and complete a purchase in a short period of time. If a busy shopper is asked to authenticate their identity using 3D Secure, they might end up abandoning their cart.

Shoppers can forget their 3D Secure passwords

3D Secure requires the following authentication information:

• Authentication password
  
• Personal message (a password the customer set when they registered)
  
• One-time password
  

Shoppers might avoid entering this authentication information because, with the exception of the one-time password, the information can be difficult to remember.

3D Secure authentication can fail

If a user sees “3D Secure Failed” displayed on their screen due to a password entry error or because their credit card does not support 3D Secure, they will not be able to complete payment on the ecommerce site in question—even if they want to purchase a product. As a result, the user might leave the site.

Further, if an error occurs due to a malfunction on an ecommerce site, a customer might naturally stop using it because they have doubts about the site’s security.

Shoppers might not trust 3D Secure if they’re unfamiliar with it

According to METI’s “Strengthening Measures Against Fraudulent Use of Credit Card Numbers, etc.” (p. 29), 3D Secure 2.0 has been implemented by almost all ecommerce businesses in the EU. However, in Japan, where adoption has been slower, users might be reluctant to use 3D Secure 2.0’s unfamiliar authentication screen.

Will 3D Secure 2.0 improve cart abandonment rates?

How 3D Secure 2.0 works

3D Secure 2.0 is known to be more reliable and convenient, with a wider range of authentication methods than the original version of 3D Secure, 3D Secure 1.0.

3D Secure 1.0 required all credit card transactions to be authenticated by a user’s predetermined ID and password. As a result, every time a user made a purchase on an ecommerce site, they had to authenticate through a special pop-up authentication screen on their current browser tab; this sometimes caused shopping carts to be abandoned due to forgotten passwords or time-consuming password entry. (Support for 3D Secure 1.0 was discontinued by international card brands in October 2022.)

In contrast, 3D Secure 2.0 only performs additional authentication if a transaction is deemed to have a high fraud risk. Fraud risk is based on information such as the shopper’s card usage history, billing address, and date of birth, as well as the place and time of the purchase, and the browser and device used. This method is known as risk-based authentication.

3D Secure 2.0 also supports biometric authentication, QR code scanning, and one-time password authentication via text message (SMS) and apps, rather than using preregistered passwords. These features reduce the need for a credit card user to create a unique password and, consequently, are expected to improve cart abandonment rates.

For businesses, 3D Secure 2.0’s risk-based authentication methods not only reduce the risk of shopping cart abandonment, but also provide more effective fraud prevention than 3D Secure 1.0.

3D Secure 2.0 and risk of shopping cart abandonment

The introduction of 3D Secure 2.0 does not completely eliminate the risk of shopping cart abandonment. This is because even if a transaction is normal—i.e., not fraudulent—it might be suspected as fraud at the time of payment. In other words, even with 3D Secure 2.0’s risk-based authentication, which is more convenient and secure than 3D Secure 1.0, users might still be prompted to enter their passwords.

There is a good chance that the detection of fraud in a normal transaction will discourage a customer’s future purchases. Therefore, it is important for ecommerce businesses to understand that a certain amount of shopping cart abandonment is unavoidable.

Further, implementing 3D Secure 2.0 does not guarantee complete protection against fraud. Fraud methods are becoming more complex and sophisticated every year, and, consequently, it might be possible for 3D Secure 2.0’s risk-based authentication to be bypassed.

How to prevent shopping cart abandonment after implementing 3D Secure

3D Secure is important for ensuring user safety while online shopping.

With the mandatory introduction of 3D Secure 2.0, users will need to go through the authentication process more and more. Therefore, businesses will need to take measures to prevent an increase in shopping cart abandonment.

Using fraud detection systems

As mentioned previously, it is possible for a fraudulent transaction to get past 3D Secure 2.0’s risk-based authentication. If this happens numerous times, the ecommerce site’s transaction approval rates are likely to be lowered by the card issuer and a stricter approval threshold for each future transaction might be set, resulting in more legitimate transactions being rejected. This could lead to more users abandoning their shopping carts.

Therefore, to provide a secure online shopping experience, while also preventing cart abandonment, it is recommended that ecommerce companies use a fraud detection system in addition to 3D Secure. Fraud detection systems can prevent damage to an ecommerce site by more accurately detecting and automatically blocking transactions that cannot be verified by 3D Secure.

In addition, fraud detection systems can reduce the risk of shopping cart abandonment for legitimate users by allowing them to make payments without additional authentication or other extra steps.

Improving the payment process

In addition to implementing fraud detection systems, a countermeasure businesses can implement is payment method improvements. This entails increasing the number of available payment methods and simplifying the payment process, while maintaining thorough security measures and providing convenience for customers.

Stripe Payments offers a wide range of payment processing capabilities, including payment fulfillment, information processing, and revenue management. Stripe Payments also provides a single platform for multiple payment needs.