Cutting-edge OAuth 2.1 protocol – including PAR and RAR – to eliminate transaction fraud while maintaining frictionless checkout conversion rates.
LoginRadius, a global leader in cloud-based Customer Identity and Access Management (CIAM), has announced the launch of its next-generation Strong Customer Authentication (SCA) engine.
Fully integrated into the company’s flagship Identity Orchestration (IO) platform, this breakthrough architecture enables financial institutions, fintechs, and large-scale digital commerce platforms to meet strict Revised Payment Services Directive (PSD2) mandates without sacrificing user experience.
As high-value online transactions and digital banking scale globally, standard password-based protection and vulnerable SMS text codes are no longer sufficient to deter sophisticated interception and fraud. The LoginRadius SCA engine solves this industry-wide pain point by combining multi-factor validation with advanced server-side orchestration, completely isolating sensitive transaction details from vulnerable client-side channels.
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“Achieving robust regulatory compliance under PSD2 has historically forced financial institutions to choose between rigid security controls and smooth operational workflows,” said Kundan Singh, VP Engineering and InfoSec at LoginRadius. “With our new SCA capabilities, financial institutions can now deploy a cryptographically bound, zero-trust transaction loop that dynamically manages fraud risk in real-time, completely protecting the bottom line while keeping the user experience seamless.”
The LoginRadius SCA framework introduces native platform support for emerging OAuth 2.1 and OpenID Connect (OIDC) specifications, fundamentally modernizing how transaction integrity is managed:
1. Cryptographic Dynamic Linking: Pair a user’s authentication approval directly to the specific payment amount and payee on the backend via server-generated tokens, instantly neutralizing Man-in-the-Middle (MITM) transaction alteration attempts.
2. Pushed Authorization Requests (PAR / RFC 9126): Removes sensitive payment parameters completely out of public, front-channel browser URLs, routing them exclusively through secure backend pipelines.
3. Rich Authorization Requests (RAR / RFC 9396): Enables platforms to inject granular, highly structured payment context—such as currency codes, merchant IDs, and precise values—directly into the secure identity stream.
4. Risk-Engineered Orchestration: Features a serverless scripting engine that executes evaluation logic inline with active login flows, checking live user context against external fraud-scoring databases before triggering biometric Passkeys or out-of-band mobile Push notifications.
Immediate Business Benefits for Enterprises
By automating the complex data dependencies required under European Union PSD2 mandates, LoginRadius provides enterprise partners with immediate structural benefits.
Successfully executing these strict SCA protocols dramatically reduces transaction fraud, eliminates regulatory compliance penalties, and enforces an automatic chargeback liability shift away from merchants and onto card-issuing institutions.
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