Riskified partners with Axerve to help KIKO Milano boost cart conversions

By Joy Dumasia

Riskified, a fraud management platform enabling frictionless eCommerce, and Axerve, an Italy-based payments hub that has developed a platform for orchestrating payments worldwide, launched an extended strategic partnership to offer Riskified’s machine learning solutions, including PSD2 Optimize, to Axerve’s portfolio of customers. One of Axerve’s first clients to implement PSD2 Optimize, KIKO Milano, saw an exemption of nearly 99% of orders from Strong Customer Authorization (SCA) using Transaction Risk Analysis (TRA) and a more than 10% increase in approval rates for transactions.

Compliance with the European Union’s PSD2 regulations and SCA requirements has added complexity for merchants, PSD2 Optimize enables merchants to minimize the effect of the European Union’s PSD2 regulations on their eCommerce by leveraging TRA exemptions to provide a seamless and secure payment experience for legitimate users and low-risk orders and for the use of 3D Secure payments to be applied only when it’s necessary. At a time when eCommerce continues growing, ensuring friction-free solutions is vital to improve the shopping experience for consumers and the collection experience for merchants.

When PSD2 came into force, eCommerce merchants across Europe immediately felt its effect on the customer journey: friction added to the checkout flow caused shoppers to abandon their carts, negatively affecting conversion rates. KIKO experienced a high volume of support tickets from customers complaining they couldn’t complete their purchase. With almost 70% of orders challenged by 3DS and a high decline rate, they realized they needed a tool to optimize their checkout process and safeguard revenue while ensuring full compliance with the regulation.

To help merchants overcome the challenges imposed by PSD2, Axerve introduced Riskified PSD2 Optimize as part of its payment processing platform: Axerve Guaranteed Payment. KIKO Milano, a long-time Axerve client, has historically championed investing in new solutions to enhance customer experience and had been looking for a fraud prevention solution to reduce fraud costs and increase conversion rates.

“When PSD2 went live, Axerve notified us that our denied transactions rate was quickly increasing, and our customer care team also alerted us that the number of tickets opened by customers was multiplying four-fold,” said Diego Morgandi, Ecommerce Director at KIKO Milano. “We were glad to hear about Riskified’s solution from Axerve, and we immediately wanted to test it. The benefits from PSD2 Optimize were immediate. We saw a reduction in failed transactions that drove the approval rate up and allowed us to grant our customers a real frictionless checkout experience. This partnership is key for us to succeed.”

“As a partner for our clients in the world of payments, it is our duty to always offer the most innovative solutions that allow us to guarantee our clients the best possible authorization rate,” said Alessandro Bocca, CEO of Axerve. “The initial phase of the PSD2 adoption was difficult since the system and the industry was not equipped for the challenge, both in managing the authentication part and also on the issuer side to manage exemptions which led to a high loss in conversions. The challenge of the SCA, and in general of fraud management, has become an opportunity after being able to join forces with Riskified, best in class on fraud prevention.”

“When PSD2 was introduced, we knew that our merchants and partners needed an immediate solution. They needed to comply with the regulation and implement 3D-secure and, at the same time, leverage exemptions in order to improve their customer experience. In order for a merchant to maximize exemptions, they have to perform a transaction risk analysis and identify those low-risk orders. And this is exactly the capability that Riskified possesses as we’ve been perfecting this in the last decade,” said Naama Ofek Ard, Chief Operating Officer at Riskified. “At the end of the day, the goal of everyone involved is to provide higher conversion rates to our merchants and a smooth experience for their customers, and this partnership is a testament to our mission and our capabilities.”