Unlocking Scalable Security: How AI Empowers Fraud Protection

Introduction 

Merchants in today's digital landscape face a critical challenge: protecting their customers and themselves from the growing threat of fraud. As fraudsters grow more sophisticated, the fight for financial security intensifies. To address this, a Fortune 200 financial services company offering payment solutions for merchants globally, encountered a bottleneck in their existing system. Currently, data scientists manually assess the impact of a fraud protection tool on each merchant, hindering scalability. This case study explores how, through collaboration with RapidCanvas, the leader unlocked an AI-led solution that transformed their approach. This new tool empowers non-experts to conduct impact assessments, allowing the company to deliver proactive protection recommendations and build stronger relationships with their clients, through their fraud protection offering. 

Challenges 

1. Bottlenecked analysis

Data scientists, responsible for analyzing each merchant's data and recommending optimal fraud rules, were overwhelmed by the volume and complexity of information. This created lengthy wait times for merchants and limited their ability to proactively address emerging threats. Manual analysis prevented the company from efficiently assessing the impact of the fraud protection tool on new merchants and scaling their support for existing ones. 

2. Limited insights 

Manual analysis often focused on a subset of available data, neglecting potentially valuable insights hidden within deeper layers. Static rules based on historical data also make it hard to keep pace with the ever-evolving tactics of fraudsters. 

3. Impact on Customer Success 

Long wait times for rule recommendations by the Customer Success team and thereafter the merchants hampered the merchants’ ability to address potential fraud concerns promptly. This could lead to lost revenue and negative customer experiences. Without clear explanations for rule recommendations, merchants’ understanding and buy-in, was also limited, potentially leading to resistance or delayed implementation.

Solution Implemented 

The RapidCanvas solution addressed these challenges by automating the entire process of data analysis and rule recommendation, and enabling the merchants to see the impact of the leader’s fraud protection tool. 

Integrated diverse data sources

Using a secure and central data repository, seamlessly ingesting diverse merchant data sources like transaction logs, user behavior data, device information, and historical fraud events was made possible. The RapidCanvas platform helped the company to build a reliable, scalable data pipeline that could automate the entire process right from data ingestion and messaging to rule recommendations using AI and reporting. 

AI-powered fraud pattern detection

Solution development involved experimenting with various modeling techniques like decision trees, random forests, k-means clustering, and anomaly detection to pick the best performing model automatically. Machine learning was thus used to identify hidden patterns and anomalies within each merchant's data. The models continuously learn and evolve, automatically adapting to emerging fraud patterns.

Dynamic rule generation 

Leveraging the insights from the analysis, personalized rule recommendations specific to each merchant's risk profile and business model were generated. This eliminated the need for generic, one-size-fits-all approaches. Clear explanations were also shared for each rule recommendation, empowering the Customer Success team to understand the rationale behind them and effectively communicate them to merchants.

Intuitive dashboards 

All insights and recommendations were presented in a user-friendly, interactive dashboard for easy interpretation by the Customer Success team and communication with merchants. The dashboard highlighted key areas of concern, prioritized recommendations, and offered actionable steps for merchants to take, promoting prompt and informed decision-making. 

Results and benefits 

The adoption of the RapidCanvas AI solution transformed the company’s fraud detection capabilities:

• Impact assessment efficiency

With RapidCanvas, assessing the impact of the fraud protection tool was streamlined by employing a user-friendly interface that empowers non-data scientists to conduct impact assessments. This not only frees up valuable data science resources but also allows for quicker turnaround times in providing recommendations to merchants.

• Instant insights

Data analysis and rule recommendations were generated in real-time, freeing up data scientists and empowering customer support for immediate action and improving their efficiency. 

• Improved accuracy

AI-driven analysis led to highly precise and relevant rule recommendations, significantly improving fraud detection effectiveness.

• Empowered business users

With this implementation, business users on the Customer Success side of operations were empowered with insights generated easily through the RapidCanvas no-code interface.  

• Rapid time to value 

The entire project, including the initial installation of custom infrastructure, was delivered to the company in weeks, speeding up the process of leveraging insights and seeing value from AI. With subsequent projects, the time to see value will continue to decrease, making AI accessible and feasible for business users. 

• Enhanced customer satisfaction

Faster response times, personalized protection, and increased security resulted in higher merchant satisfaction and loyalty. They were able to see the impact of the fraud protection tool, and its impact on their revenue and instances of fraud. 

• Scalable support

With this implementation, the team ensured seamless onboarding of new merchants and continuous optimization for existing ones, ensuring comprehensive fraud protection for all.

Conclusion 

By embracing AI-powered fraud detection, the financial technology leader not only eliminated manual bottlenecks but also revolutionized their approach to merchant protection. Their new, user-friendly tool empowered non-experts to conduct impact assessments of the fraud protection tool, streamlining the process for both the company and its merchants. This, in turn, allowed merchants to receive real-time, personalized recommendations for fraud detection rules, ensuring proactive defense against emerging threats. This translated to increased efficiency, stronger security, and ultimately, deeper trust and loyalty from their clients.