{"id":5283,"date":"2019-06-17T11:04:41","date_gmt":"2019-06-17T16:04:41","guid":{"rendered":"https:\/\/3dmerchant.com\/blog\/?p=5283"},"modified":"2021-12-03T03:22:51","modified_gmt":"2021-12-03T08:22:51","slug":"visa-prevents-approximately-25-billion-in-fraud-using-artificial-intelligence","status":"publish","type":"post","link":"https:\/\/3dmerchant.com\/blog\/merchant-processing-industry-news\/visa-prevents-approximately-25-billion-in-fraud-using-artificial-intelligence","title":{"rendered":"Visa Prevents Approximately $25 Billion in Fraud Using Artificial Intelligence"},"content":{"rendered":"\n

Since pioneering AI in payments, continuous evolution of the technology in Visa Advanced Authorization helps drive commerce and consumer confidence<\/strong><\/em><\/p>\n\n\n\n

SAN FRANCISCO–(BUSINESS WIRE)–Visa Inc. (NYSE: V) today announced new analysis showing Visa Advanced Authorization (VAA) using artificial intelligence (AI) helped financial institutions prevent an estimated $25 billion in annual fraud\u2014making the global payment ecosystem safer for retailers and consumers.i VAA is a comprehensive risk management tool that monitors and evaluates transaction authorizations on the Visa global payment network, VisaNet, in real time to help financial institutions promptly identify and respond to emerging fraud patterns and trends. Visa processed more than 127 billion transactions between merchants and financial institutions on VisaNet last year, and employed AI to analyze 100 percent of the transactions\u2014each in about one millisecond\u2014so financial institutions can approve legitimate purchases while quickly identifying and preventing fraudulent transactions. <\/p>\n\n\n\n

\u201cOne of the toughest challenges in payments is separating good transactions made by account holders from bad ones attempted by fraudsters without adding friction to the process,\u201d said Melissa McSherry, senior vice president and global head of Data, Risk and Identity Products and Solutions, Visa. \u201cVisa was the first payment network to apply neural network-based AI in 1993 to analyze the riskiness of transactions in real time, and the impact on fraud was immediate. By striking the right balance between human expertise and technology innovation, we continue to evolve our capabilities as new AI breakthroughs expand the realm of what\u2019s possible.\u201d <\/p>\n\n\n\n

For financial institutions, friction in the payment process can lead to the abandonment of a payment card. A study by Javelin Strategy & Research revealed more than half of cardholders affected by false declines (51 percent) used a secondary payment card to complete the purchase at the same merchant, which can push a competitor\u2019s card to the top of wallet.ii However, removing friction cannot come at the expense of identifying and preventing fraud. As a survey by the National Retail Federation and Forrester discovered, the top payment-related challenge faced by retailers is fraud, cited by 55 percent of those surveyed.<\/strong><\/p>\n\n\n\n

Visa Advanced Authorization is a layer of fraud prevention that can help drive down risk and fraud for financial institutions and retailers, and help reduce friction due to false declines for payment account holders. More than 8,000 financial institutions in 129 countries use Visa Advanced Authorization. <\/p>\n\n\n\n

Preventing fraud near the speed of light <\/h2>\n\n\n\n

Visa pioneered using neural networks modeled after the human brain to power its AI platform to identify possible fraud. This delivers faster and deeper insights through previously unknown correlations. Delivered through Visa Advanced Authorization, retailers and financial institutions benefit from:
\u2022 Machine Learning models used for real-time examination of each transaction for indicators of fraud\u2014looking at activities, patterns and more than 500 risk attributes\u2014all in about one millisecond.
\u2022 Risk scoring, which Visa shares with the account holder\u2019s financial institution, where the decision is made to either approve or decline the transaction, or flag the transactions for follow up with the account holder.
\u2022 The ability to identify good transactions even when made by new or infrequent shoppers, reducing the likelihood of false declines.
\u2022 Real-time authorization using integrated, global predictive analytics to identify and prevent fraud.
Visa has kept global fraud rates at historic lows\u2014less than 0.1 percent\u2014through a multi-layered approach of investing in human intelligence and technology like A.I.; empowering consumers and clients with tools, resources and control to manage risk; and setting governance processes to help businesses and regulators stay nimble.iv
\u201cConsumers identified Visa as the most trusted company to provide financial services or payments among all payment networks and we believe it is due to Visa\u2019s unrelenting focus on eliminating fraud and protecting the payment ecosystem,\u201d said McSherry.v
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Additional Risk Solutions Using AI <\/strong>
Visa champions security every day to protect the payment ecosystem and offers a portfolio of risk products and services that can help consumers, merchants and financial institutions prevent fraud. This includes Visa Risk Manager (VRM), Visa Consumer Authentication Services (VCAS) and CyberSource Decision Manager (DM), among others. For more information about Visa\u2019s Risk solution portfolio, visit Visa Security. <\/p>\n\n\n\n

Additional Resources<\/strong> <\/p>\n\n\n\n