29 April 2017
visit nextgenbanking.co.uk

MasterCard applies AI to combat false declines

30 November 2016  |  7176 views  |  0 Mastercard - PayPass

MasterCard is adding artificial intelligence as a core component to its network in an effort to provide better risk scoring across all transactions and cut the number of false declines.

MasterCard's Decision Intelligence goes beyond current risk assessment profiling by assessing, scoring and learning from each transaction. It examines how a specific account is used over time to detect normal and abnormal shopping spending behaviors, using account information like customer value segmentation, risk profiling, location, merchant, device data, time of day, and type of purchase made.

The data is fed back to the issuer and used to adjust risk scores for the next transaction.

Earlier this year, the card scheme rolled out MasterCard IQ, an authorisation and assurance toolkit designed to provide deeper insights into cardholder spending habits in a split-second. Authorization IQ uses the unique and historical behavior of the card to predict and assess risk against a current transaction. The Assurance kit enables the exchange of information from the merchant about the particular circumstances of a transaction to help provide a more nuanced risk score.

Research by Javelin shows that the value of false declines per year has hit $118 billion, more than 13 times the total amount lost annually to actual card fraud ($9 billion). Not only are such refusals more likely to hit more affluent consumers who spend more on big ticket items, they also have a negative rebound in customer attitude towards the bank and merchant.

“We are solving a major consumer pain point of being falsely declined when trying to make a purchase,” sayus Ajay Bhalla, president of enterprise risk and security, Mastercard. “By using AI technology on our global network, we’re helping financial institutions and merchants improve approval rates - and the consumer experience.”

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

MasterCard rolls out selfie payments across Europe

MasterCard rolls out selfie payments across Europe

04 October 2016  |  30691 views  |  0 comments | 86 tweets | 136 linkedin
Home Depot suit accuses card schemes of putting profits ahead of security in EMV roll out

Home Depot suit accuses card schemes of putting profits ahead of security in EMV roll out

16 June 2016  |  7822 views  |  6 comments | 9 tweets | 5 linkedin
MasterCard goes into battle against false declines

MasterCard goes into battle against false declines

19 February 2016  |  10166 views  |  5 comments | 9 tweets | 13 linkedin

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit vasco.com/news/PSD2-compliant-solutionsFind out morevisit dh.com

Top topics

Most viewed Most shared
Six global banks join Swift DLT trialsSix global banks join Swift DLT trials
7835 views comments | 16 tweets | 36 linkedin
BBVA steps up fintech acquisition strategy with purchase of OpenpayBBVA steps up fintech acquisition strategy...
7040 views comments | 17 tweets | 16 linkedin
Should central banks open up payment and settlement systems to non-banks?Should central banks open up payment and s...
6155 views comments | 22 tweets | 21 linkedin
JPMorgan formally quits R3JPMorgan formally quits R3
6065 views comments | 23 tweets | 14 linkedin
Token raises $15.7 million as PSD2 approachesToken raises $15.7 million as PSD2 approac...
5970 views comments | 20 tweets | 20 linkedin

Featured job

to 120K base, £300K ote, stock options
London, UK

Find your next job