Co-op applying AI to help CUs fight card fraud
Co-op Financial Services is working with Feedzai, a company that specializes in artificial intelligence for payments applications, to bring Co-op CU clients a machine learning-based risk management tool later this year.
“A key pain point for credit unions in 2017 is that fraud mitigation tools have not kept pace with the relentless advance of fraud,” Todd Clark, President and CEO of Co-op, said in a press release. “We are investing $20 million this year on new innovations to ensure credit unions have access to the very best technology in the payments industry. Implementing machine learning capabilities is a key initiative in delivery on that promise.”
The platform will be able to take in any amount of relevant, multisource data to define transaction risk scoring, incorporating events such as cardholder PIN changes and the purchasing patterns of individual members in order to better predict behavior.
Based on constant learning and scoring updated in real time, suspect transactions detected by machine learning can be declined on the spot or kicked out immediately to fraud team members for analysis.
For card payments, machine learning will augment the existing neural network-based Falcon Fraud Manager fraud detection system used by the Co-op card member security team.
In addition, machine learning will be deployed as the primary fraud management tool for Co-op Shared Branching.