Acquirer Fraud2020-08-19T14:26:56-07:00

Acquirer Fraud

Harness the power of AI to reduce transaction-level fraud and merchant risk

Imagine having a 360-degree view of your merchants’ businesses so you can monitor risky behavior and report with confidence. You would onboard merchants with assurance, knowing you’ve done your due diligence. You could confidently prevent good orders from being falsely declined.

Since the advent of EMV (chip) cards and growing e-commerce sales, the liability for transaction-level fraud has landed on the shoulders of acquirers and their merchants. Yet most acquirers and payment service companies rely on rules-based systems that return high volumes of false positives. This results in billions of dollars of lost revenue. Meanwhile, merchant attrition causes up to $2 billion annually as it’s difficult to evaluate merchant risk. Fraud is becoming increasingly sophisticated and acquirers are the ones with the most to lose.

At Brighterion, we tailor each model to our customers’ unique business needs. You will have the opportunity to see results while the model is being built, confirming accuracy and return on investment. Once you’re comfortable with your solution, we can build additional models to meet other business needs. You can proceed with certainty knowing that advanced AI is the way forward.

We call this process AI Express, which transforms your data into intelligence in just six to eight weeks.

“One of the [telling] moments was when we saw the output from the models became more effective than output from rules. On a rules-based only system, you may have to generate 50 alerts to find one fraud. With an AI system, it will only need to generate two or three because it’s looking for unusual activity compared to what it’s seen historically.”

Ian Belsham

Global Head of Transaction Monitoring, Worldpay

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Reduce transaction-level and merchant fraud: a concise guide to mitigation

Download the Ebook to learn how to:

  • Identify why real-time decisioning is critical to mitigate risk and prevent fraud
  • Determine the soaring cost of fraud and value of customer retention
  • Use AI to detect and prevent transaction-level and merchant fraud proactively

Use case: 

Challenge

Acquiring banks are losing money to card-not-present and friendly fraud, chargebacks and false declines. They’re also at risk for merchant fraud. In 2019, $19.21 billion was lost worldwide to transactional fraud alone. Merchants lost another 20 percent of that total to chargebacks.

Acquirers and merchants generally use rules-based fraud detection systems, typically receiving

high rates of false positives. As a result, at least half of those sales need manual review and yet three-quarters are approved. Investigators are overburdened, but have little time to focus on acts of legitimate fraud. Aite Group analysts report false declines are such a problem that 79 percent of merchants track false decline rates.

“The increasing sophistication of fraudsters demands smarter, more nimble and innovative fraud tools that allow us to stay one step ahead. We look forward to bringing the strength and flexibility of Brighterion’s AI platform to our fight against fraud.”

Tim Miller

Senior Vice President, Global Credit and Risk, Elavon

Solution

Brighterion AI’s one-to-one analysis is enabled by integrating multiple data points, such as transaction and user history, current activity and account events. Use cases are finely tuned for both merchant risk and transaction-level fraud. Our advanced AI models provide behavioral insights into every interaction.

Real-time decisioning streamlines merchant onboarding and automates risk mitigation, monitoring and reporting. By creating an overall behavioral profile based on historical transaction data, the solution develops a baseline risk score, then creates profiles and scores for each merchant. The platform scans batch uploads to monitor dramatic spikes or declines in the number of transactions, unusually large purchases, bust-out fraud and identity swap.

This real-time analysis also helps you predict transactional fraud before it happens. Creating profiles for each card, account and merchant, the system alerts acquirers to false declines, cart abandonment, friendly fraud, use of unauthorized credentials and more. When the system sends an alert about suspicious activity, you can intervene before the transaction completes, preventing expensive chargebacks.

Results

Worldpay, the largest global acquirer, achieved immediate results from the Brighterion AI platform to:

  • Increase detection up to 3x
  • Reduce false positives up to 20x
  • Reduce business rules from 50,000 to 250
  • Replace fraud prevention rules with supervised and unsupervised learning

As a result, Worldpay expanded its Brighterion AI implementation for risk monitoring across all of their lines of business, including anti-money laundering (AML) and credit risk.

INCREASED DETECTION

3x

REDUCED FALSE POSITIVES

20x

Key benefits


Improve merchant and
consumer experience with
higher approval rates


Reduce manual review
costs for transactions
and merchant onboarding


Access a 360-degree view
of each merchant’s business
in real time


Have peace of mind
with a stable and
experienced AI partner

“The payments industry is changing, and it’s changing rapidly. We need someone like Brighterion who’s dynamic enough to be able to adapt as quickly as we need to adapt to those changes.”

Ian Belsham

Global Head of Transaction Monitoring, Worldpay

Request a demo to learn how you can go from data to intelligence in 6-8 weeks

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