3DS Authentication Failed? Here's What to Do

1. Introduction#

People now depend on online purchases through digital transactions, but these methods pose online payment security threats. The 3DS authentication failed scenario occurs when users provide incorrect information or when their one-time password (OTP) has expired, but it also indicates a major system malfunction. Understanding the relationship between authentication system failures and cybercrime is essential, as account takeover (ATO) fraud is expected to reach $17 billion worldwide in 2025.

The article examines how 3D Secure authentication systems fail and the advanced methods that attackers use to compromise online payment authentication systems. We'll examine real security breaches affecting major organizations and show you methods to defend your business operations during instances when 3DS authentication fails.

2. Understanding 3DS Authentication#

Three-Domain Secure (3D Secure) protects your cardholder information during online shopping by requiring identity verification before processing transactions. You will need to enter your credit card information on the merchant payment page before the system will direct you to an authentication page. The system allows users to confirm their identity through three verification methods: one-time password (OTP), biometric authentication and security question responses.

Online merchants protect their security through authentication systems that they enable during payment processing. The system verifies that the person conducting the purchase transaction is the card owner, which protects users from online fraud. 3D Secure includes three components, or domains:

• The domain of the merchant (the online retailer)
• The domain of the acquirer (the bank that processes the transaction for the merchant)
• The domain of the issuer (the bank that issued the credit card to the cardholder)

The three domains work together to verify your identity at all purchase locations before the transaction begins. The card issuer might send you an OTP to your registered mobile phone or email, or prompt you to approve the transaction in their mobile banking app.

The number of failed authentication attempts has increased despite 3D Secure's security features. There are many reasons for 3DS authentication failures, from simple mistakes by cardholders to complex cyberattacks. The first step in error source identification helps you reduce your risk of financial loss when shopping online.

3. Credential Stuffing#

Credential stuffing is a common tactic used by cybercriminals to steal usernames and passwords from other websites by leveraging data from data breaches. If someone gets a user's email address and password from a data breach, they can try those credentials on other web services to see if they work.

If someone uses the same password for more than one account, an attacker who gets that password can get into most of that person's business accounts. A lot of people use the same password across multiple platforms, like banking or shopping. This means that if someone gets into one account, they can often get into others as well.

After the massive Equifax data breach in 2017, which affected more than 148 million people, there was a surge in credential stuffing attacks in the financial services industry. Attackers tried to access the bank accounts of people whose credentials had already been stolen.

They used stolen login credentials to access banking, payment and online store apps. Once inside, attackers could view saved payment methods and attempt to make fraudulent purchases. Strong 3-Domain (S3D) authentication sometimes blocks these attempts due to unusual activity patterns.

3.1 How to protect against credential stuffing#

Businesses can use hard-to-phish passkeys instead of passwords to stop credential-stuffing attacks. Passkeys use pairs of public and private keys, meaning the private key stays on the user's device. Because passkeys can't be reused, guessed or stolen, credential stuffing is impossible. Attackers can't use a passkey anywhere else because it only works for one service.

4. Phishing Attacks#

Phishing uses social engineering to get people to make mistakes by putting them under stress or pressure. Phishing attacks on payment systems have improved significantly in recent years. Attackers can now make almost exact copies of real 3D Secure (3DS) authentication pages.

People who want to steal your money send you emails or text messages that appear to be from your bank or credit card company. These messages indicate a problem with your account or a suspicious transaction. They have a link to what appears to be a real 3DS login page. If you enter your username, password or payment information on the fake page, attackers can use SIM swapping or exploit flaws in account recovery to bypass future verification steps.

Sometimes attackers use real-time phishing to send your 3DS authentication challenge to a fake page. The attacker will use your one-time password (OTP) immediately to complete the fake transaction on the real site if you enter it on the fake page.

Many advanced phishing attacks have targeted PayPal, for example. Researchers found a large phishing campaign in 2019 that used fake PayPal payment authentication pages to steal login credentials and 3D Secure (3DS) verification codes. In these attacks, hackers sent emails saying that users needed to verify their accounts right away and led them to convincing fake websites where their OTP codes were stolen in real time.

4.1 How to protect against phishing#

Use passkey-based solutions and log in with hard-to-phish credentialing methods, such as Fast Identity Online 2 (FIDO2) or Web Authentication (WebAuthn). Passkeys are meant to be hard to phish because they verify the website's domain before letting you in. Your passkey won't work on a fake website, and attackers won't be able to steal your credentials. Secure device-binding protocols are used for authentication.

5. Session Hijacking and Cookie Theft#

Infostealer malware has turned stealing sessions into a business. This malware steals cookies and active sessions from a device and then sells them on the dark web. Attackers can buy these session cookies and use them to take over an account as if they had logged in with the user's credentials and multi-factor authentication (MFA).

Your web server makes a session cookie when you log in and enter your payment information. This tiny file stores your login information and serves as proof that you are logged in. If an infostealer virus gets your session cookie, an attacker can load it into their own browser and access your account without needing your password or going through multi-factor authentication (MFA).

This is a significant risk for payment methods, as hackers can change payment information, add new payment methods or accept credit card payments without going through a new 3D Secure (3DS) challenge.

The CircleCI breach in 2022 is a big example of this kind of attack. An engineer's laptop had infostealer malware on it that stole both passwords and active session cookies. This allowed attackers to bypass two-factor authentication and access production resources containing private customer data.

5.1 How to protect against session hijacking#

One choice is to use device-bound session credentials (DBSC). With DBSC, each session is linked to a specific device using encryption. If an attacker steals a session cookie, they can't use it on another device because it's locked to the hardware it was made on. This method stops session theft at the protocol level, so you don't have to wait until after the fact to find out about it.

6. Common Causes of 3DS Authentication Problems#

There are a few reasons 3D Secure (3DS) authentication might not work in practice. These problems can be caused by technical issues or user errors, such as typos. If you don't fix these problems, more authentications will fail. Finding and fixing them quickly will help you get your customers' electronic transactions back on track as soon as possible.

6.1 Incorrect Information#

Most of the time, failed authentications occur when the user enters incorrect information. Some common reasons include entering the wrong one-time password (OTP), entering the wrong PIN or not knowing the answer to a security question. If Caps Lock is on when you enter the OTP, the authentication will fail.

6.2 Outdated Payment Information#

The card issuer may not approve the transaction if your payment information is out of date or expired. If you try to use an old payment card that the issuer no longer thinks is valid, authentication will also fail. Always check that your merchant account has the most up-to-date information about card expiration dates and CVV codes.

6.3 Network Issues#

Authentication can fail if the authentication page doesn't load or your internet connection drops while it's processing. Unstable connections can cause timeouts by breaking communication between the merchant, the payment processor and the card issuer. The 3DS authentication window may also not appear if you have strict privacy settings or an aggressive pop-up blocker.

6.4 Outdated Browsers#

The 3D Secure authentication process may not work with older browsers or outdated technology. You need a modern browser that supports new JavaScript features, cookie-based technology and secure redirect protocols to use 3D Secure 2.0. Authentication can be compromised if you use an outdated browser or one on a business network with strict access controls.

6.5 Invalid Credentials#

If the phone number or email address linked to the cardholder's record is wrong, the one-time password (OTP) and verification codes won't reach them. You need to keep your phone number and email address up to date with your credit card issuer so they can send the OTP. If you change your phone number and don't update your financial institution, you won't get the verification code.

7. If you suspect Fraud#

If you think your account has been hacked or the steps you took before didn't work, act quickly and do the following:

• Call your bank or card issuer right away if you see anything strange. Most banks offer services to protect you from fraud and can freeze your card to stop someone from using it without your permission. When you call, make sure to tell them exactly when the authentication failed and provide details about any emails or messages that seemed strange.
• Change the password for the hacked account and for any other account that uses the same password. Update all your passwords right away if you've used the same ones across multiple services. Use passkeys whenever you can in the future. Passkeys help fill in security holes that come with using passwords to log in.
• If you run business accounts, make sure you have a privileged access management system in place. Only allow privileged users to view sensitive payment details, and require them to complete certain steps before granting administrative rights. This lowers the chance of an attack.
• Instead of using SMS for two-factor authentication (2FA), use an app-based authenticator or a hardware security key. A SIM swap attack can get around SMS, so it's not as safe for multi-factor authentication (MFA). Using a hardware key or an authenticator app makes you safer.
• Check your bank and credit card statements regularly to ensure there are no unauthorized charges. To get an alert right away when charges happen, sign up for transaction alerts. Most of the time, fraud starts with a small transaction to see if your card is still active before making bigger purchases.

8. Conclusion#

Security threats have moved away from traditional methods and are now looking for holes in those systems. Attackers will take advantage of any chance they get to get into your account. This can cost you a lot of money and hurt your reputation. Account takeover fraud is expected to cost businesses and consumers around the world $17 billion this year.

If you see the message 3DS authentication failed, it could mean someone is trying to hack you, or that your account's security measures are out of date. Your phishing protection might not be up to date, or your login information might have been stolen. You and your business can lower the risk of online transaction fraud by keeping your security up to date. This includes using phishing-resistant authentication methods like passkeys, staying up to date on trends and threats and knowing how the authentication process works.

In the future, safe online transactions will look very different. Authentication will no longer use knowledge-based methods such as passwords or one-time codes sent by SMS. Instead, it will use possession-based and biometric methods. People and businesses can stop many of the ways that criminals attack them today, such as credential stuffing, phishing and session hijacking, by switching to these newer options.