In a bid to combat the fast-growing, ever-evolving world of electronic payment fraud, IBM has acquired IRIS Analytics, a German analytics firm that leverages artificial intelligence and cognitive techniques to detect and prevent payment fraud in real time.
The IRIS Analytics fraud analytics engine, used by leading banks and payment processors around the world, acts as a virtual analyst using machine learning to detect new fraud patterns, generate rapid anti-fraud models and support the creation and modification of proven ad-hoc models.
“The cognitive computing approach unleashes a new paradigm in fighting fraud,” said Alistair Rennie, general manager, industry solutions, IBM.
The integration of IRIS Analytics with IBM’s counter fraud technology is expected to help organisations detect fraud at scale more accurately and more quickly, enabling them to increase the speed of implementing countermeasures and reducing the incidence of false positives.
A recent study by the IBM Institute of Business Value discovered that banks typically take more than four weeks to deploy countermeasures after detecting fraud and that only 16 per cent of banks polled could detect fraud in real-time.
“Defences against financial crime are in critical need of innovation and improvement,” said IRIS Analytics CEO Constantin von Altrock, citing the increasing need for financial institutions to be able to make fast and accurate decisions before the payment is executed as the payments industry evolves with chip, PIN, mobile and immediate payments.