Touchtech Payments

Touchtech Payments. It is a financial technology company specializing in software for payment service providers and merchant acquirers, with a core focus on facilitating Strong customer authentication (SCA) as mandated by the Revised Payment Services Directive (PSD2) in the European Union. Founded in Dublin, the company was acquired by the global payments giant Stripe in 2019 to bolster its regulatory technology capabilities. Touchtech's platform is designed to help online businesses manage complex payment card industry compliance and fraud prevention requirements across the Single Euro Payments Area.

History

The company was founded in 2014 by John O'Sullivan and Aisling O'Riordan, emerging from the entrepreneurial ecosystem at Trinity College Dublin. Its early development was supported by the startup accelerator NDRC and received seed funding from investors including Enterprise Ireland. Touchtech initially focused on developing application programming interface-driven tools for payment processing, but strategically pivoted to address the impending regulatory changes introduced by the European Banking Authority under PSD2. This foresight positioned the company as an early expert in SCA protocols like 3-D Secure (3DS). In April 2019, the San Francisco-based payments infrastructure company Stripe announced its acquisition of Touchtech Payments, a move widely analyzed by industry observers like TechCrunch and Finextra as a key strategic purchase to integrate critical regulatory compliance technology directly into Stripe's payment gateway.

Products and services

The company's primary product is a cloud-based software platform that enables payment service providers and large merchants to deploy and manage Strong customer authentication seamlessly. This involves orchestrating the various application programming interface calls required for the 3-D Secure 2.x protocol, which can include biometrics, one-time passwords, or other verification methods. The platform is designed to reduce payment abandonment by optimizing the customer experience during the authentication challenge, a significant concern for e-commerce businesses. It also provides tools for transaction risk analysis, allowing merchants to apply exemptions from SCA for low-risk payments as permitted by the European Banking Authority's technical standards, thereby streamlining the checkout process.

Technology and security

Touchtech's technology is built on a microservices architecture hosted on major cloud infrastructure providers like Amazon Web Services, ensuring scalability and reliability for high-volume payment processing. The core of its system is a sophisticated rules engine that dynamically decides when and how to apply SCA based on a myriad of factors including transaction value, merchant category, and historical fraud patterns. Security is paramount, with the platform designed to be fully compliant with the Payment Card Industry Data Security Standard (PCI DSS) and the General Data Protection Regulation (GDPR). It employs advanced cryptography for data protection and does not store sensitive primary account number data, instead utilizing tokenization to reference transactions securely.

Business model and partnerships

The company operated on a Software as a service (SaaS) model, charging its clients—primarily other financial technology companies and merchant acquirers—based on application programming interface call volume or a percentage of processed transaction value. Prior to its acquisition, Touchtech had established key technology partnerships with several major players in the European payments landscape to integrate its authentication layer. Following its acquisition by Stripe, its technology and team were fully integrated, and its products are no longer marketed independently. The acquisition served as a key partnership that enhanced Stripe's Radar fraud prevention suite and its ability to serve customers in regulated markets like the European Economic Area.

Industry impact and recognition

Touchtech Payments is recognized for having played a pivotal role in demystifying and operationalizing Strong customer authentication for the European payments industry ahead of the PSD2 enforcement deadlines. Its early specialization helped shape implementation best practices for many fintech firms. The company's acquisition by Stripe was cited as a landmark deal in the Irish technology sector and highlighted the strategic value of regulatory technology. In 2018, it was named one of the top fintech startups to watch by publications like Forbes and received awards from Irish Times innovation competitions. Its work directly influenced the user experience of SCA for millions of consumers transacting online across the Single Euro Payments Area.

Category:Financial technology companies Category:Companies based in Dublin Category:Online payment systems