By the time your customer finishes their morning coffee, you’ve already processed their subscription renewal, installment payment, or delayed shipping charge. All securely, and without them lifting a finger. That’s the quiet power of 3RI.
You might not have heard of 3RI (Requestor-Initiated Authentication) also known as Merchant-initiated authentication yet, but if your business depends on recurring billing, split shipments, or subscription models, it’s something worth paying attention to.
And for South African merchants, it could be the key to lower fraud risk, reduced payment costs, higher conversions and smoother customer experiences – if you know how to put it to work.
First, what exactly is 3RI?
In plain terms, 3RI allows you to obtain authentication from a customer and bank even though they are not actually initiating the transaction at that moment. Let’s say a customer signs up for a monthly service. You process the first payment with full authentication, and their card details are securely stored – usually via tokenisation.
Tokenisation protects the card details; 3RI then makes it possible to use those saved credentials to trigger future payments securely and without needing the customer’s involvement again.
It’s seamless for them, secure for you, and a major step forward in reducing failed payments and drop-offs in recurring flows.
Why Should South African Merchants Care?
There are a few big reasons this matters – especially in the South African context.
1. Higher Success Rates (Conversion rates)
With 3RI, merchants see far fewer declines on recurring payments because banks are authenticating each transaction against fresh data rather than relying on outdated credentials. That means fewer expired OTPs, fewer abandoned checkouts, and a smoother experience for customers who don’t have to re-authenticate every month. The result is a measurable uplift in authorisation rates – especially valuable in subscription models, BNPL instalments, and sectors like travel or insurance where payment drop-offs can directly translate into lost revenue.
2. Liability Shift
With 3RI, the risk of fraud shifts away from you to the customer’s bank. That means fewer chargebacks eating into your revenue; especially important for sectors like travel, ticketing, and digital subscriptions, where Card-Not-Present fraud can be a real concern.
3. Lower Interchange Fees
Because 3RI counts as a 3D Secure-authenticated transaction, you benefit from 3DS-level interchange. That’s a win for any business processing large volumes of payments.
Real-World Use Cases: Where 3RI Fits In
3RI is already quietly powering some of the most common online payment flows. If your business offers any of the following, 3RI is worth considering:
- Recurring subscriptions
From retailers offering Buy Now, Pay Later, to travel agents managing multi-supplier bookings, education platforms automating monthly fees, and insurers collecting recurring premiums, Peach Payments enables businesses across industries to charge customers reliably and without friction, OTPs, or failed payments.
- Split or delayed shipments
Send out products in batches? Pre-orders with long lead times? 3RI lets you charge when items are shipped while keeping authentication fresh.
- Â Multi-merchant travel bookings
Travel agents or marketplaces can charge one card for multiple suppliers, using a single customer authentication at checkout.
A Quiet Shift and a Coming Deadline
As from 18 October 2024, card scheme guidelines discourage / prevent the reuse of older 3D Secure authentication data (CAVV) in many scenarios.
Getting the benefits of 3RI isn’t just about switching it on — it’s about setting it up the right way for your business model.
For 3RI to work it requires all parties in the ecosystem to be ready i.e. Acquirers, Issuers, PSPs and Merchants.
We are already seeing Acquirers and Issuers make the changes needed and at Peach we have already implemented the changes required to our APIs to support 3RI. As 3RI is rolled out in South Africa we will be ready to enable it for our merchants.
A Quiet Shift and a Coming Deadline
As from 18 October 2024, card scheme guidelines discourage / prevent the reuse of older 3D Secure authentication data (CAVV) in many scenarios.
Getting the benefits of 3RI isn’t just about switching it on — it’s about setting it up the right way for your business model.
For 3RI to work it requires all parties in the ecosystem to be ready i.e. Acquirers, Issuers, PSPs and Merchants.
We are already seeing Acquirers and Issuers make the changes needed and at Peach we have already implemented the changes required to our APIs to support 3RI. As 3RI is rolled out in South Africa we will be ready to enable it for our merchants.
At Peach Payments, we guide you through the process step by step:
1. Work with our payment specialists
Our team helps you evaluate where 3RI makes the biggest impact -whether that’s subscription renewals, insurance premiums, or split shipments and ensures your integration is aligned with your business goals.
2. Configure recurring and scheduled flows
We help you set up the right parameters in your system, so payments like instalments, monthly fees, or delayed fulfilments can be triggered securely in the background without customer friction.
3. Stay compliant and future-ready
We ensure your customer and transaction data is passed correctly to the 3D Secure system, helping you meet regulatory requirements and avoid disruption as new rules (like the October 2024 deadline) come into force.
In Summary
3RI is one of the most important evolutions in online payments you’ve probably never heard of. It helps businesses:
- Reduce fraud risk
- Lower processing costs
- Improve customer experience
- And meet upcoming compliance rules
It’s not a silver bullet — and it requires the right setup to be effective, but for South African merchants aiming to scale securely and efficiently, it’s a tool worth adding to your payments arsenal.
Read more about our Recurring Transactions offering here.<\/p>
