Silicon Valley-based Stripe, a payments tech firm valued at $22.5 billion, has bought Touchtech Payments, a Irish software startup that builds online authentication systems for banks.
With customers including Target, Lyft, and Amazon, Stripe was used by half of all Americans who bought something online in 2017, according to Bloomberg. In other words, those transactions were done through businesses whose payments were processed by Stripe.
Touchtech Payments works with banks to help them build and manage Strong Customer Authentication, a verification process that usually requires two different forms of authentication from cardholders to process transactions, according to Techcrunch.
Strong customer authentication will be required on most transactions in Europe as of Sept. 14, 2019. The new European regulations are expected to radically change the way European customers buy online, Touchtech said in a prepared statement. Businesses and banks will have to adapt and build an extra layer of authentication into online credit card payments.
Thousands of European online sellers will have to upgrade their payments platforms to prepare for the regulation, Stripe said.
“One of the largest contributors to online credit card fraud is the lack of proof that the cardholder is in possession of the card at the time of purchase,” said Shekinah Adewumi, co-founder of Touchtech Payments, in a 2015 Irish Times report.
Adewumi studied engineering at Dublin City University. He launched Touchtech Payments in 2014 with co-founder Niall Hogan. Adewumi is head of strategy and has been listed as chief commercial officer. Hogan is head of product.
With Touchtech’s Transaction Authentication Platform (TAP), bank customers no longer need to remember passwords but can use the fingerprint scanner on their phone to authenticate online payments,” Adewumi said on his LinkedIn page.
Touchtech raised a total of $1.4 million in funding from Enterprise Ireland, the Irish government agency responsible for developing and promoting indigenous business, according to Crunchbase.
Stripe is the most valuable financial services startup in the world, Business Insider reported. The company says it builds economic infrastructure for the internet, and has raised $785 million in funding from investors including CapitalG (formerly Google Capital) and Visa.
Touchtech will be based in Stripe’s Dublin office. “We are really looking forward to the things we can build by working with Stripe,” the company said in a statement.
Written by Dana Sanchez