This month's biggest news
One of this month's hot topics revolves around fraud control, and Giacomo Austin from Paysafe shared a compelling article on how machine learning is reshaping anti-money laundering (AML) controls. Machine learning streamlines compliance efforts by automating tasks and refining decision-making processes for payment providers. These advancements are crucial in tackling sophisticated fraudsters and meeting the growing demand for swift and secure payments. By analyzing data, machine learning aids in fraud detection, risk assessment, and compliance reporting, bolstering Know Your Customer (KYC) and AML processes.
Machine learning models enable real-time transaction monitoring, suspicious activity reporting, and identification of compliance issues. Building trust in machine learning necessitates transparent communication about model functions and addressing biases through robust data management and diverse perspectives. Embracing machine learning requires a steadfast commitment to data quality and collaboration, ultimately empowering industry experts in their fight against financial crime.
?? Explore the full article: How machine learning is transforming AML controls in payments
Speaking of fraud, it's undoubtedly a major challenge faced by both users and financial institutions on a daily basis.
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1?? Loss of money due to chargebacks
2?? Loss of trust from your users
3?? Loss of reputation as a product
The first point is particularly significant because disputes can be costly: for every dollar in a disputed transaction, an additional $1.50 is spent on fees and expenses.
In 2022, the average chargeback-to-transaction ratio stood at 0.60%, indicating that 6 out of every 1000 transactions resulted in a chargeback. Moreover, the total losses attributed to chargebacks amounted to a staggering $40 billion.
The second and third points go hand in hand and are perhaps as crucial, if not more so, than the first. Losing the trust of your users? That’s incredibly challenging to recover. Once it's lost… there’s no turning back. That’s why it’s vital to listen to their needs and provide detailed information about each transaction.
What’s the solution? There are many possibilities, but one of them is enriching transaction data. This involves providing details about where the purchase was made, contact information for the merchant, etc. Offering this information is invaluable to your users because it empowers them to take action and know who to contact in case of any doubts.
For more insights, check out our detailed discussion on "Advancements in Fraud Detection using Payment Enrichment Data" on the Finextra blog.
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Turkish finance app downloads see 8.7% rise over past 12 months
Fintech Global has recently shared an intriguing report detailing the growth of financial app downloads in Turkey. The report provides valuable insights into the evolution of the country's leading apps.
Of particular significance is the noteworthy growth observed from April 2023 to April 2024, marking an 8.7% increase, totaling a staggering 72 million finance app downloads.
Upon closer, it becomes evident that incumbent banks slightly surpassed FinTechs, with 38.4 million downloads (53% share), while FinTechs recorded 33.5 million downloads (47% share). Notably, Ziraat, a prominent Turkish retail bank, emerged as the leader in downloads from 2017 to April 2024, amassing an impressive 48.8 million. Ziraat commands a 13.9% market share among retail banks in 2021 and boasts a commendable 4.5-star rating on the Play Store.
?stanbulkart, Istanbul's transportation fare payment provider, was the most downloaded Turkish FinTech app in the same period with 39.7 million downloads. Despite its high download numbers, ?stanbulkart has a low Play Store rating of 1.7.
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Conclusion
Fraud remains a significant challenge for both users and financial institutions, with potential impacts ranging from monetary losses to erosion of trust and damage to reputation. Enriching transaction data emerges as a promising solution, providing users with detailed information and empowering them to take proactive steps when needed.
Furthermore, recent regulatory scrutiny of merchant fees, such as the UK regulator's initiatives, underscores the importance of transparency and accountability within the payments ecosystem.
Stay updated on industry developments by following us, and don't hesitate to reach out if you have any questions or want to learn more about our data enrichment solutions.
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