For experts, the major challenge in online payment transactions is to make them more secure without increasing conflicts with customers. They remember that the process of shopping is quick and easy without cash, either via the web or in-store.
However, the consumer is not aware of the many security processes that go behind each transaction: Automated fraud detection systems to protect the various actors involved: the customer, the merchant, the issuing bank, the acquiring bank, among others.
Transparency is one of the many reasons why the industry uses the classic method based on rules derived from human experience to detect fraud.
The major challenge in financial fraud prevention is to selectively achieve a high degree of accuracy: identify-block fraudulent and suspicious transactions, and since most transactions are legitimate, they should be processed as quickly and without friction.
INFORM CEO Federico dos Reis explained that to protect these aspects, the banking industry uses software designed to prevent financial crimes, and There are cases in which the risk potential of each transaction is assessed in real time.
“It has to work reliably for the millions of operations performed every day, and to achieve this, containment systems often use methods based on artificial intelligence,” the manager said in a statement.
Good fraud detection software can provide the right balance between risk protection and customer convenience,
Transparency is one of the many reasons why the industry uses the classic method for fraud detection, Comparing customer behavior with known fraud patterns allows you to create simple, easy to understand rules.
But the limits defined in these rules are often identified by fraudsters, who operate without being discovered by security protocols. To avoid the above, Techniques based on fuzzy logic allow human thinking to be mirrored with soft boundaries that avoid these problems.,
“Knowledge-based rules offer an advantage: if an expert identifies a new fraud pattern, they can enter the system to immediately stop other fraud attempts of the same nature.
In contrast, the self-learning algorithm (traditional AI) requires statistical significance. Therefore, the new pattern must be repeated in order to be considered fraudulent, and this is where our hybrid system, which combines both worlds, provides the industry with a better solution ”, Dos Reis said.
Digital channels of businesses are affected by loss of sales due to fraudulent operations or friction in the process. Technologies that enable risk-based authentication They solve this paradox by improving user experience and optimizing conversion rates and sales.