There are certain types of payments that are exempt from SCA.
Thes could be any items in an online store with a value less than €30, fixed amount subscriptions or merchant-initiated transactions less than €30.
To qualify for this exemption, your business must have an agreement with your customer and have them authenticate their card when it’s being saved or authenticate the first payment.
Merchant-initiated transactions are payments made with a saved card when the customer is off-session. An example might be a gym membership, Netflix or Spotify subscription payment.
Any online transactions under €30 is considered low value and could be exempted from SCA. However, the issuers’ bank will request authentication if the exemption has been used five times consecutively or if the sum of exempted payments is more than €100.
So, if a customer buys a shirt online for €28, that transaction will be exempt and SCA is not required. If the same customer on the same website buys another shirt for €28 then its still exempt. But if the customer returns for the 4th time using the same card then the value has exceeded €100 and SCA will be applied.
So even if your online store only sells low-value items, you will face potential issues with returning or multiple purchase/bulk buying customers.
The good news is, there are payment providers that help businesses take full advantage of these opportunities by automatically requesting exemptions.
When exemptions are accepted by your customers’ banks, your customers won’t have to authenticate, minimizing the impact on conversion.
Ecommerce websites or booking websites cannot rely on exemptions and must design their payment flows to authenticate customers when the situation arises.
Any exceptions will be determined by your customers’ banks which is done on a case by case basis, with every bank making their own decision when authentication happens.