GLOSSARY
SCA
Strong Customer Authentication — the European requirement that online card payments be verified by two independent factors.
Strong Customer Authentication (SCA) is a regulatory requirement under the EU’s revised Payment Services Directive (PSD2). For most online card payments inside the EEA, the customer must authenticate using at least two of three factors:
- Something they know (password, PIN)
- Something they have (phone, hardware token)
- Something they are (fingerprint, face)
In practice this usually means a 3D Secure 2 challenge: the customer’s bank prompts them via app or SMS to confirm the payment. Properly implemented, the challenge is invisible for low-risk transactions (frictionless flow) and only surfaces when the bank’s risk engine wants extra confirmation.
Kotao’s payments stack handles SCA automatically — both the 3DS challenge flow and the exemptions (low-value transactions, trusted-beneficiary lists, recurring transactions) that let the customer skip the challenge when it’s safe to. You don’t manage the protocol; you just see whether the payment succeeded.
In the product
Where this term matters in operation.
The glossary is not meant to be academic. It explains the language teams use in Kotao while selling, planning, paying, reporting, and automating.
In sales
Terms like this appear inside POS, checkout, bookings, offers, and customer communication.
In back office
Finance, inventory, HR, and reporting need the same meaning so reports do not drift apart.
In integrations
APIs, imports, webhooks, and exports work better when teams use the same definitions.
Related terms.
Flat-rate card pricing
A single, transparent percentage charged on every card transaction — no interchange-plus, no scheme fees, no surprises.
Acquirer
Bank or payment institution that signs merchants and routes their card transactions into the card networks.
API (Application Programming Interface)
A set of rules and protocols that allows different software applications to communicate with each other.
Apple Pay
Mobile wallet by Apple that tokenizes cards for contactless and in-app payments.