Nets and KPMG Partner to Launch AI-Powered Payment Fraud Prevention Solution
September 2019 by Marc Jacob
Nets has collaborated with multinational professional services provider, KPMG, to develop Nets Fraud Ensemble, a next-generation fraud monitoring and prevention solution.
As the total annual value of fraudulent transactions across Europe hits €1.8 billion, the need to step up fraud prevention, particularly in card not present (CNP) transactions, has never been greater. Reducing transaction fraud is an increasingly convoluted and nuanced business, however, as factors such as the mass adoption of e-commerce, increasing cross-border payments, and the growing popularity of new digital payment methods combine to add new layers of complexity. Nets Fraud Ensemble is an AI powered anti-fraud engine that assists fraud prevention teams to navigate this ever-changing landscape in real time. By deploying true machine learning (i.e. a system that identifies emerging fraud indicators as well as established patterns), it represents a significant step forward from the rules-based models that are currently in use across the international banking industry.
The ‘brain’ of Nets Fraud Ensemble consists of multiple models working together to analyse each individual transaction within ten milliseconds – the time frame in which a transaction can be safely blocked. The solution learns from the results of its analysis and adjusts accordingly, meaning the longer that it is operational the more fraudulent transactions are blocked, and the fewer false positives are granted. In initial pilot programmes, it reduced fraudulent payments by 25% within weeks and up to 40% in the long-term.
The benefits to issuers extend beyond achieving significant reductions in fraud. Nets Fraud Ensemble also decreases operating costs and chargebacks, creating an improved cardholder experience. Furthermore, to balance accuracy with customer convenience, issuers can implement customised decision thresholds to minimise false declines.