Entersekt reframes 3-D Secure as a revenue recovery tool

Firms get what they measure, and for years, payment security technology has been measured by how much fraud it stops.

Untold billions of dollars have been invested in risk models, authentication technologies and compliance frameworks designed to stop fraudsters before they can exploit the financial system. But a growing number of payments executives are beginning to focus on a different question: How much legitimate revenue is being blocked in the process?

“The amount of transactions that are falsely declined vastly outweighs the actual fraud,” Dewald Nolte, co-founder and Chief Strategy Officer at Entersekt, told PYMNTS. “Ironically, we’re declining a lot more good transactions than we’re actually stopping fraud.”

Fraud losses are visible, measurable and routinely reported. False-decline costs, by contrast, are distributed across customer experience, merchant performance and long-term revenue outcomes. As a result, they often remain hidden within broader business metrics.

But as margins tighten across financial services and competition for customer loyalty intensifies, institutions are searching for ways to improve approval rates without increasing fraud exposure. Richer transaction intelligence offers one potential path forward, and this reality is already positioning the next evolution of 3-D Secure, EMV 3DS 2.x, as a mechanism for improving authorization rates, reducing false declines and strengthening customer relationships.