ValidSoft, the global supplier of strong authentication and transaction verification, has announced the availability of VALid-POS, the company's unique approach to combating cross border card fraud.
VALid-POS is designed to address the three critical issues that contribute to the cost of cross-border card-present fraud; actual fraud losses, false-positive transaction blocking and resolution of these potentially anomalous transactions. VALid-POS provides both the detection and resolution capabilities that are crucial in providing greater intelligence in detecting fraudulent transactions and reducing internal processing costs.
Detection of potentially fraudulent cross-border ATM and PoS transactions has typically been performed through the use of risk engines, but the intelligence available on which to base real-time transaction authorisation decisions is limited. This lack of qualitative information means that currently, 9 out of 10 declined transactions - world-wide - are in fact legitimate.
VALid-POS combats both cross-border and domestic card present fraud, covering both Point-of-Sale and ATM devices. The technology works by establishing whether a transaction is authentic based on customer and transaction proximity, using real-time mobile telephony, without tracking the individual. VALid-POS not only reduces false-positive card declines by as much as 95%, it is also totally invisible to the card user. Because it operates at sub-second speeds, it also provides the banks with the option to detect fraudulent transactions in either a real-time or near real-time model.
"Card-present fraud detection strategies, whether domestic or cross-border, using traditional risk-engine data sources are still reliant on what is primarily historical information. VALid-POS, using real-time telecommunications intelligence, can fundamentally alter how card-present fraud is managed through its unparalleled accuracy in detecting fraudulent transactions and, by definition, recognising non-fraudulent transactions," said Pat Carroll, CEO, ValidSoft "Whether a bank's strategy is cross-border false-positive reduction or earlier domestic detection of a compromiseromised card, VALid-POS provides the missing factor."
In addition to immediately identifying and accepting the majority of cross-border transactions as legitimate, reducing the volume of transactions that need additional scrutiny means the resultant subset of transactions deemed potentially fraudulent now has a much higher detection rate and lower false-positive rate. By allowing banks to adjust existing thresholds, more transactions can be checked for potential fraud, an option not previously possible because of the associated costs.
VALid-POS integrates directly with ValidSoft's strong authentication and transaction verification platform, VALid, to optionally provide resolution of every suspect transaction, whether genuinely fraudulent or false-positive.
Whether a bank manually performs this resolution process, uses an outsourced agency or a combination of both, the process can be expensive and hit-and-miss, as the resolution contact can take place well after the actual transaction. In many cases, the customer will have already contacted the bank, tying up valuable fraud department resources.
Unlike many automated fraud case management tools or manual follow-up processes, VALid-POS performs the resolution in real time rather than hours or even days later. In the case of the remaining false-positives, this means cases can be resolved and rectified while the customer is still standing at the ATM or PoS device. For confirmed fraudulent transactions, customers will be routed directly to a fraud operative, ensuring resources are dedicated to genuine fraud cases.