How Visa’s AI Tool Slashes Phishing Losses by 90% for Banks
Visa is broadening its technological offerings with an advanced fraud prevention platform incorporating artificial intelligence (AI) to identify fraudulent transactions instantly.
This system, known as the ARIC Risk Hub, is developed by Featurespace, a company under Visa, and is specially designed to create user profiles that help distinguish fraudulent activities from legitimate ones.
The collaboration stemmed from Featurespace's 15-year legacy in machine learning focused on financial service applications, originating at Cambridge University.
The platform's design operates within an open ecosystem, integrating with various payment methods and beyond Visa's proprietary network, thus enabling financial institutions to implement this advanced fraud prevention technology across their entire payment infrastructure.
Norwegian implementation demonstrates efficacy
One notable deployment involved Eika Group, a consortium encompassing 46 local banks in Norway, which reported a 90% decrease in phishing attack losses from 2023 to 2024.
Phishing schemes often involve misleading communications intended to extract sensitive information or financial resources from unsuspecting recipients.Eika Group faced specific challenges such as increasing fraud rates targeting their elderly clientele, the emergence of sophisticated fraud patterns evading previous detection systems and operational burdens due to manual transaction reviews.
Jon Hagen, Chief Architect at Eika, explains how the system operates: “Featurespace's AI-powered technology learns and adapts in real-time, and profiles normal user behaviour in an efficient manner.
“As fraud patterns evolve, we will need to add more rules and maybe adjust some of the old ones. Adjustment of the rules is easy, given the powerful support of the Featurespace system.”
This technology dynamically evaluates online and mobile banking transactions, flagging those identified as suspicious for further scrutiny or blocking them completely before they are processed.
Adapting AI for evolving threats
“As fraud patterns evolve, we will need to add more rules and maybe adjust some of the old ones. Adjustment of the rules is easy, given the powerful support of the Featurespace system"
The ARIC Risk Hub employs adaptive AI, a methodology that excels through continuous evolution based on new data.
It sets foundational behavioural profiles for each customer, allowing for immediate identification of transactions that deviate from these norms.
This adaptability alleviates the issue of false positives, thereby enhancing the customer experience and reducing operational costs.
Antony Cahill, President of Value-Added Services at Visa, adds: “Accepting a payment is a fundamental need of any business.
“Leveraging new technology to accept payments more efficiently and securely can be what sets a business apart in today's rapidly digitalising world.
“With our new services, we're helping businesses harness data-driven insights, simplify the checkout experience, and fight fraud more effectively than ever.”
Tareq Muhmood, Head of Value-Added Services, Europe at Visa, continues: “We are thrilled to be integrating ARIC Risk Hub into our offer to businesses and financial institutions.
“We have been using AI for over 30 years to fight fraud, and now by integrating behavioural data with ARIC's cutting-edge technology we will further help our clients to stay ahead of emerging threats.”
Currently available globally, the ARIC Risk Hub allows financial institutions of various scales to enhance their fraud prevention measures, showcasing Visa's commitment to infusing the latest technological advancements into its service offerings.
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