Today a reader sent me an email about “Verified by Visa” service. He obviously didn’t know anything about the Verified by Visa and thought it was a phishing site. I think it is necessary to talk about what the Verified by Visa is for and how it works. My friend actually placed an order at Newegg.com to purchase the Panasonic Lumix DMC-TZ5 digital camera and he didn’t know what the Verified by Visa was, as a result, he placed the order twice at Newegg.com.

So what is Verified by Visa?

Verified by Visa is free to Visa cardholders and was developed to help prevent unauthorized use of Visa cards for online shopping. The cardholders can choose a password at through activation of the Verified by Visa service. Only the cardholders remember the password. Thus Verified by Visa protects Visa cards with personal passwords, giving cardholders reassurance that only they can use their Visa cards online. Once your Visa card is activated, your card number will be recognized whenever it’s used at participating online stores (Click here to see the participating stores.). A Verified by Visa window will automatically appear and your Visa card issuer will ask for your password. You’ll enter your password to verify your identity and complete your purchase.

For the online stores that are not participated in the Verified by Visa service, you can use your Visa card as normal.

The Verified by Visa is an attempt by Visa to reduce online fraud and identity theft. However, there are some problems associated with it. Because the Verified by Visa step comes as a pop-up window and general shoppers usually think pop-up windows are from phishing sites. Actually, if you look at the domain of the pop-up window, you will find that the domain is not from the site where the user is shopping, not from the card issuing bank, or visa.

Actually, Verified by Visa is a 3-D Secure protocol which is an XML-based protocol used as an added layer of security for online credit and debit card transactions. The 3-D Secure protocol was developed by Visa to improve the security of Internet payments and offered to customers as what we now know Verified by Visa service.

How does Verified by Visa work?

• Activate your Verified by Visa service in the Verified by Visa program now or while shopping online. You have to provide your visa card account number and last 4 digits of your social security number along with other information. It’s easy and only takes a few moments to activate your card. You can do it right here on the secure Visa site or when prompted during the checkout process at one of our participating online merchants. Either way, your information is protected. (link to activate the service: https://verified.visa.com/aam/data/default/landing.aam?partner=default)
• Shop at participating online merchants with Verified by Visa symbol.
• Use your Visa credit card or debit card at the checkout and then put in your Verified by Visa password. Once your password is recognized by the transaction system, your order will be successfully placed.
• There is no charge — Verified by Visa is free to Visa cardholders.

Verified by Visa used to pop up at many online merchants which participate in the program. Right now, this service seems not so popular and not all online retailers are using it. But the Verified by Visa still is an important and effective way to reduce your risk when you place an order at the websites that out of US. Many payment network might still require you to use Verified by Visa service.