Buyer groups and card companies breathed a sigh of relief in
late November when the European Commission confirmed an exemption for corporate
payments from new payment security standards that require strong customer
authentication. SCA is a secondary verification of the payer's identity, such
as keying in a PIN number received by text, every time the payer makes a remote
payment. It's a great idea for reducing high levels of fraud in consumer
payments, but it's a lousy idea for corporate mechanisms like central lodge
cards, for which no individual is identifiable with the payment and for which
fraud levels are low anyway.
The capacity for SCA to cripple the lodge card process was
blindingly obvious to anyone in corporate travel but not to the European
Banking Authority, which drafted the standards at the European Commission's
behest in early 2017. With the EBA impervious to argument, thus began frantic
lobbying of the European Commission to insert an exemption for corporate
payments. The commission listened and drafted a carve-out. The EBA protested.
The commission held its ground, and the exemption survived into publication of
the commission's final draft.
Many associations, companies and individuals contributed
valiantly to saving managed travel from a whole world of pain. But one of the
most active campaigners was AirPlus' Patrick Diemer, who personally led
lobbying of German regulators, European parliamentarians and the European
Commission itself and was perhaps the first to draw business travel's attention
to the brewing storm. "The major achievement was to make regulators aware
of the specifics of corporate requirements because this regulation was created
with consumer protection in mind," said Diemer.
Even with exemption all but assured, work remains. "We
have some cards which count as consumer cards anyway," Diemer said,
referring to individual pay company cards that are heavily used in Germany. The
travel industry also needs to introduce SCA for leisure customers. Diemer has
therefore launched a working group of payment providers, global distribution
systems and other relevant parties to create an industry standard for
integrating SCA into the travel payment process.