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Unifying digital commerce, the SRC way

September 27, 2023


451 Research’s Global Unified Commerce Forecast, projects online retail sales to expand to $5.8 trillion by 2022.

With this growth at the backdrop, let us explore the ease with which digital commerce happens, especially the checkout experience. Most often than not, the options provided can make it confusing for the consumers.

You are spoilt for choices, and you don’t find it easy to choose any of the options from the fragmented and complex web of payments and technology providers.

This complexity creates an inconsistent customer experience, low conversion rates, and a disjointed approach to security, resulting in shopping cart abandonment.

The advent of SRC

To address uniformity in digital commerce payments, EMVCo has released the Secure Remote Commerce (SRC) specifications, and most major brands have voiced their support towards it. They have slowly started rolling out their SRC checkouts.

The best part of SRC is the standard buy button that the customer would see on the merchant site or app. When you click the standard buy button, and upon authentication, all the payment options that the customer has already enrolled through their issuers will pop out, and they can choose their preferred choice.

However, for this to be successful, there has to be an unprecedented amount of collaboration between the various stakeholders. The stakeholders will be issuing banks, acquiring banks, payment gateways, payment schemes, payment service providers, aggregators, digital wallets, digital commerce platforms, shopping carts, and app developers.

Let us look at some of the roles involved in SRC.

SRC roles and players

SRC initiator (SRCi) – securely retrieve payment card and shipping address data for the transaction. Acquirers or payment service providers or aggregators will perform this role.

Digital Shopping Application (DSA) – DSA will be the merchant’s e-commerce shopping cart and e-commerce checkout page. The app developers would do this.

SRC system – the core of the SRC implementation framework that orchestrates the flow between all participating roles. The payment schemes would perform this role.

Digital Card Facilitator (DCF) – is the entity that provides the consumer with secure storage of one or more digital cards with billing and shipping addresses to facilitate the checkout experience. Digital wallet providers would act as a DCF.

SRC Participating Issuer (SRCPI) – card issuer that enrols payment cards with each of the SRC systems and that authorizes the e-commerce transactions. Issuing banks will handle this.

SRC program – set of policies, procedures, rules for governing, and oversight of the SRC operation and participants. Payment schemes will handle this.

SRC promotions – a fair bit of marketing dollars will have to be spent by payment schemes to onboard merchants as well as consumers.

All of these will have to work together, and it is easily a few years before it becomes mainstream. However, it is a step in the right direction for homogenizing digital commerce payments.

Goutham Venkataram

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