Mastercard uses AI to flag real-time payment fraud for UK banks

By Gloria Methri

Mastercard is taking the fight to the fraudsters with its one-of-a-kind AI-powered ‘Consumer Fraud Risk’ solution, now live in the UK.

Leveraging Mastercard’s AI capabilities and its network view of account-to-account payments, it is helping banks predict and prevent payments to scams of all types. In partnership with nine UK Banks, including Lloyds Bank, Halifax, Bank of Scotland, NatWest, Monzo, and TSB, Mastercard is using large-scale payments data to help identify real-time payment scams before funds leave a victim’s account.

Organized criminals move ‘scammed’ funds through a series of ‘mule’ accounts to disguise them. To counter this, for the past five years, Mastercard has worked with UK banks to follow the flow of funds through these accounts, and then close them down.

Based on insights from this tracing activity and overlaying them with specific analysis factors, Mastercard’s AI solution provides banks with the intelligence necessary to intervene in real-time and stop a payment before funds are lost.

TSB is one of the first banks to adopt Mastercard’s Consumer Fraud Risk tool and is already using it to great effect. Other banks adopting Consumer Fraud Risk are doing so over the course of 2023.

“Banks have found these scams incredibly challenging to detect,” said Ajay Bhalla, president of Cyber and Intelligence at Mastercard. “Their customers pass all the required checks and send the money themselves; criminals haven’t needed to break any security measures. As we all live more digital lives this type of fraud erodes victims’ confidence to interact online. Our goal is to build and maintain that trust. Using the latest AI technology, we are helping banks identify and predict which payments are being made to fraudsters and stop them in real-time.”

Mastercard is rolling out Consumer Fraud Risk in the UK first as it has deep experience in tracing and stopping financial crime across the country’s real-time banking system and has helped to coordinate banks into sharing their fraud data. It is now accessing the next most appropriate markets to adopt the technology.