In a strategic move to enhance its financial authentication capabilities, Entersekt, the leading player in the field, has successfully acquired the Modirum 3-D Secure software business from Modirum, a renowned digital payment security provider. The acquisition, finalized for an undisclosed sum, marks a significant development in the ever-evolving landscape of financial technology.
Modirum, with a rich history spanning 25 years, has been a trailblazer in facilitating authenticated card-not-present payments. Its cloud-based 3-D Secure (3DS) technologies have been instrumental in authenticating digital payment transactions globally across various payment systems, issuers, and merchants. Entersekt’s acquisition of Modirum’s 3DS business is a strategic move to address the escalating challenges faced by financial institutions in combating fraud threats.
According to Julie Conroy, Chief Insights Officer at Datos Insights, financial institutions grapple with the complexities of using disparate authentication tools across various banking channels, leading to inconsistent user experiences and vulnerabilities in fraud prevention strategies. The integration of Entersekt’s authentication capabilities with Modirum’s 3DS products aims to provide consumers with a seamless, cross-channel user experience and robust protection against evolving fraud schemes.
With this acquisition, Entersekt is poised to expand its customer base significantly, securing over 2.5 billion transactions annually. This move not only affords Entersekt a compelling global footprint but also establishes a clear technological advantage with a solution spanning digital, payment, and data channels for issuers, acquirers, and merchants.
Schalk Nolte, co-founder and CEO at Entersekt, highlights the broader set of solutions and increased data sources resulting from the combination of Entersekt and Modirum. This strategic move allows Entersekt to scale globally, providing the financial world with a comprehensive, cross-channel platform for secure, frictionless, Context Aware™ Authentication of customers and payments.
Entersekt plans to integrate Modirum’s 3DS solutions into its Entersekt Secure Platform for transaction authentication, with the entire Modirum 3DS team joining the company. This acquisition is expected to accelerate product development, enhance Entersekt’s existing product offering, and reinforce the company’s ability to scale and support customers globally.
Moreover, Modirum’s impressive list of customers significantly boosts Entersekt’s market share of financial institutions offering 3DS, making the combined offering the most advanced solution available for financial institutions today. Kumbi Gundani, Head of Telecommunications, Media, and Technology at Standard Bank South Africa, expresses pride in supporting Entersekt’s acquisition, emphasizing the bank’s commitment to promoting African technology on the global stage.
Entersekt’s 13-year track record in helping financial institutions reduce fraud losses, increase revenue, maintain regulatory compliance, and deliver superior customer experiences positions it as a key player in the industry. The incorporation of Modirum’s expertise further strengthens Entersekt’s ability to offer advanced Context Aware Authentication, protecting digital payment transactions against continually evolving fraud threats.
Modirum, founded in 1997, has a global presence in over 50 countries, serving more than 100,000 merchants, hundreds of card issuer banks, and over 100 million cardholders. The alignment of Modirum’s 3DS solution and talented team under the unified brand, Entersekt, signifies a response to the market’s demand for an integrated digital payment security platform.
In the words of Modirum CEO Jari Heikkinen, “Entersekt delivers amplified strengths in both online payment and customer authentication through a single offering, breaking down silos and enabling higher transaction success rates, reduced false declines, and less fraud for financial institutions, ultimately improving the overall consumer experience.”
Entersekt’s strategic acquisition of Modirum’s 3DS business stands as a testament to the dynamic nature of the financial technology sector and sets the stage for a more secure and integrated future in digital payment authentication.
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.