Mastercard has taken a significant step towards safeguarding UK consumers from financial scams by enhancing its Consumer Fraud Risk (CFR) solution. The upgraded system, powered by advanced AI insights, empowers UK banks with real-time fraud detection capabilities, significantly strengthening their defenses against the rising tide of Authorised Push Payment (APP) scams.
These scams, often orchestrated through deceptive websites, emails, text messages, or phone calls, have become a major concern in the UK, costing consumers a staggering £460 million ($607 million) in 2023. The new regulations from the UK’s Payment Systems Regulator (PSR) mandate banks to reimburse victims of APP fraud, effective October 7th, with a few exceptions.
Mastercard’s CFR solution has been a game-changer since its launch in early 2023, already assisting 11 UK banks in identifying and halting fraudulent transactions before funds were transferred out of victims’ accounts. The system analyzes multiple transaction-related data points to generate a real-time risk score for the sender’s bank, enabling them to assess potential fraud. This has been a crucial tool in the fight against APP scams, contributing to a 12% decrease in their total value in 2023, according to the PSR.
The recent AI-driven upgrades to the CFR solution extend its reach even further. Now, receiving banks also receive the same real-time risk score within seconds, enabling them to detect payments directed to fraudulent or “mule” accounts. This adds another layer of protection, further reducing the chances of successful scams.
Mastercard’s dedication to innovation in fraud detection is strengthening the UK banking sector’s efforts to combat payment fraud and safeguard consumers. As Johan Gerber, Executive Vice President, Security Solutions at Mastercard, aptly states, “Fraudsters have long sought to deceive the consumer through scam websites and fictious deals. That’s why, at Mastercard, we are turbocharging our technology, providing banks additional lines of defence – helping them better identify and stop scams in their tracks.”
Early offline tests of the enhanced ‘inbound risk’ alerts have demonstrated their effectiveness, showing a 60% improvement, on average, in banks’ ability to detect high-risk mule accounts within their account base at an early stage. Mastercard plans to roll out the Consumer Fraud Risk solution globally within the year, extending its consumer protection benefits and contributing to a more secure digital ecosystem for everyone.
