Credit Card Processing, Security and PCI Compliance

Mastercard SecureCode and How to Use It


June 24, 2023

What is Mastercard SecureCode? How do you use it? These questions may be on your mind as a business owner in the internet age. If you sell products or services online, it’s worth your time to consider whether 3D secure technology is a good addition to your anti-fraud toolkit.

The card brands claim minimal impact on your customer’s checkout process while adding additional protection.

But how does it work, and why should you care about the additional protection? Let’s take a look at what using Mastercard SecureCode entails and how it may help or harm your bottom line.

What is Mastercard SecureCode?

Mastercard SecureCode is an anti-fraud tool used to verify that only authorized users are making a purchase online. In most iterations, it requires a separate passcode to be entered at the time of checkout in addition to other details such as card number, CVV, or billing address.

However, some companies, like PAAY, offer plugins and APIs that bypass the passcode except in transactions that don’t meet certain criteria. The result is a smoother checkout process for customers that still offers the added security of obtaining an authorization based on factors like IP address and the customer’s previous spending habits.

How is it more secure?

Mastercard SecureCode minimizes the risk of purchases by unauthorized parties. Other options, like CVV (the 3-digit code on the back of a card) can potentially stop a fraudulent transaction if the purchaser only has the card number, but that failsafe doesn’t work if they have the physical card. However, having the physical card with CVV doesn’t give the unauthorized user access to the SecureCode, meaning they will not be able to complete the purchase even though they have all of the physical card data.

For that reason, it’s important that cardholders keep their SecureCode to themselves or authorized purchasers only.

What are the benefits of using Mastercard SecureCode as a business?

One of the primary benefits Mastercard touts is that using SecureCode may protect you against chargebacks under the reasons “cardholder unauthorized” or “cardholder not recognized.” Since the SecureCode is viewed as a higher level of verification, Mastercard may determine that a fraudulent transaction that got through SecureCode is not the business’ fault.

In some cases, you may also be able to reduce your interchange fees. This can happen if you qualify for lower cost SecureCode-related interchange categories.

Interchange Fee Reduction

Mastercard has two different categories for 3D-Secure interchange. One applies to transactions where the business is set up to use SecureCode, but the cardholder is not. The other applies to transactions where both the business and the cardholder properly use SecureCode.

Mastercard’s UCAF interchange categories apply to such transactions. While it’s not possible to negotiate the rate of a specific category, you can sometimes take measures to instead qualify for a lower cost category. That’s how it works with UCAF.

How do I implement it?

You’ll need to contact your credit card processing company to ensure that it supports 3D Secure technology, like Mastercard SecureCode. From there, you’ll be able to install a SecureCode plugin on your website and authorize transactions.

Related Article: Verified by Visa

Does it cost extra?

There is no additional charge from Mastercard to use SecureCode. However, your processor or website developer may have additional costs for implementing Mastercard SecureCode. Be sure to check with your processor about its specific fees for fraud tools.

How do consumers use it?

From the consumer side, using Mastercard SecureCode is pretty simple: Consumers set up their code with their issuing bank. Then when consumers make a purchase on a website that uses 3D Secure, your site will prompt for their SecureCode when they check out.

As mentioned above, with certain implementations, customers won’t even need to enter their code.

Are there any drawbacks to MasterCard SecureCode?

One possible drawback is the added step in the checkout process in the traditional set up. While Mastercard claims that the impact is minimal, many businesses know that it doesn’t take much for a consumer to abandon their online shopping cart. Before implementing Mastercard SecureCode, consider your checkout process and the potential impact of customers, and track your checkout completions after implementation. Alternatively, consider a service that streamlines the process so there is no customer impact.

Ben Dwyer

BY Ben Dwyer

Ben Dwyer began his career in the processing industry in 2003 on the sales floor for a Connecticut‐based processor. As he learned more about the inner‐workings of the industry, rampant unethical practices, and lack of assistance available to businesses, he cut ties with his employer and started a blog where he could post accurate information about credit card processing. As the blog gained in popularity, Ben began directly assisting merchants in their search for a processor. Ben believes in empowering businesses by providing access to fair, competitive pricing, accurate information, and continued support. His dedication to transparency and education has made CardFellow a staunch small business advocate in the credit card processing industry.

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  1. from Robert Bidinost, on December 31, 2018

    Just spent 3 hours trying to make a purchase through a vendor that uses MC securecode. Complete waste of time, it may protect your card info better but the hassle is not even close to worth it. After calling MC, my bank, and the vendor multiple times no one had any idea what securecode was or how to register it. We will never make any future purchases with any vendor that uses MC securecode.


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