Mastercard AI Fights Payment Fraud

Mastercard has introduced a new artificial intelligence (AI)-powered tool that aims to aid banks in combating payment fraud and schemes in real-time, before any financial transgressions.

According to an announcement made by the financial services provider on July 5, the ‘Consumer Fraud Risk’ solution’s artificial intelligence is trained using years of transaction data received from British institutions in partnership.

Through data analysis, the system can determine whether a user is attempting to transfer funds to an account previously associated with “authorized push payment scams.” Ajay Bhalla, president of cyber and intelligence at Mastercard, stated in the announcement that detecting these types of fraud has historically been “extremely difficult.” Stating:

“Their customers pass all the required checks and send the money themselves; criminals haven’t needed to break any security measures.”

The objective, according to him, is to use AI to enable institutions to detect such scenarios in real-time. Mastercard stated in its official announcement that it has been utilizing AI for “the better part of the last decade” and that this is now a “foundational technology.”

Mastercard reports that nine of the largest institutions in the United Kingdom, including Lloyds Bank, Halifax, the Bank of Scotland, NatWest, Monzo, and TSB, have signed up for the solution.

While the program has thus far only been implemented with U.K.-based institutions, Mastercard says it is in discussions regarding expansion with clients in the United States, India, and Australia, among others.

Mastercard has a history of integrating Web3 tools and emerging technologies into its business model. In April, the company announced a Web3 user verification solution that aims to improve user verification standards and “reduce opportunities for bad actors” in the digital asset space.

In April, Mastercard also introduced an accelerator program for musicians that required participants to acquire a nonfungible token (NFT).