The European Banking Authority Favors Arbitrary Box-ticking Over Data Innovation

The European Banking Authority (EBA) recently proposed new rules that would require payment card operators to enforce additional security measures, such as passwords or security tokens, for all online transactions over €10. Aimed at fraud prevention, these proposed rules mean that unless customers add vendors to pre-approved lists held by their card providers – and re-authorize them with the extra security measures every month – “one-click” transactions would become impossible. This would affect not only online shopping sites like Amazon and Otto, but also services like Uber and Deliveroo that use in-app payments. While fraud prevention is important, data-driven approaches offer far more sophisticated measures to address this goal, writes Nick Wallace in Banking Technology.