SUBSCRIBE TO TMCnet
TMCnet - World's Largest Communications and Technology Community

CHANNEL BY TOPICS


QUICK LINKS




Using AI for Fraud Protection


Fraud & Identity Featured Article


Using AI for Fraud Protection

Share
Tweet
October 20, 2017
By Mandi Nowitz Web Editor

Fraud is becoming a mixed bag of defense mechanism trying to identify a growing number of attack vectors. With all of the efforts to prevent fraudulent activity, though, it can seem a little overprotective, especially when legitimate transactions are being rejected. In 2016, $493 billion worth of genuine transactions were blocked by anti-fraud technologies based on false positives. While some of that revenue was likely realized through alternative payment options or by legitimizing with financial institutions, it’s certain that vendors lost a sizable sum because of false positives.


German-Israeli payment security company Fraugster is aiming to turn this problem around. It has integrated with Finconecta, a program creating the first interconnected ecosystem of solutions between financial institutions (FIs) and leading financial technology companies (FinTechs). In Europe, Fraugster is utilized by two out of the four largest payment companies. It offers full liability for each analyzed transaction while covering any card-not-present fraud losses, which speaks to Fraugster’s confidence in the accuracy of its solution.

Exactly how does it work to ensure fraud protection? Machine learning techniques are put in place to mimic human analyst thought processes, using an in-memory database that leverages artificial intelligence (AI) to reach conclusions. A user’s behavior is thoroughly analyzed on multiple levels with a solid decision on the activity made within 15 milliseconds.

All of the methods put in place enhance merchants’ revenue realization, as fewer “good” transactions are lost, keeping more customers satisfied and reducing lost revenue due to false postivies. The company has found a base in Latin America, where market has seen a significant dip due to a growing fear of fraud. E-commerce transactions in Mexico have declined by 14 percent while Peru saw a major drop of 60 percent.

Named one of the 21 leading companies utilizing AI for next gen financial services solutions, Fraugster is working with companies like Ingenico, Wirecard, and Credorax. The goal is to ensure client safety, which is worth more than $35 billion. Fortunately, full liability is in place if anything were to go wrong.

Does your business have a good fraud detection solution in place?




Edited by Erik Linask

Article comments powered by Disqus





Technology Marketing Corporation

35 Nutmeg Drive Suite 340, Trumbull, Connecticut 06611 USA
Ph: 800-243-6002, 203-852-6800
Fx: 203-866-3326

General comments: tmc@tmcnet.com.
Comments about this site: webmaster@tmcnet.com.

STAY CURRENT YOUR WAY

© 2018 Technology Marketing Corporation. All rights reserved | Privacy Policy