Small to Midsize Banks Benefit from Reduced Fraud with Award-Winning Fiserv Solution Leveraging FICO Analytics

Rhea-AI Summary

Fiserv, a leader in payments and financial technology, has been awarded the 2022 FICO® Decisions Award for its innovative AI-driven fraud management solutions. The company reported a 10-15% reduction in fraud losses for its financial institution clients and a 20% decrease in false declines. Fiserv's EnFact® Advanced Scoring uses patented neural network technology for real-time fraud detection, significantly enhancing cardholder experience. The award reflects Fiserv's commitment to democratizing fraud mitigation for smaller financial institutions, ensuring robust protection against evolving fraud trends.

Positive

• 10-15% reduction in fraud losses for banks and credit unions using Fiserv solutions.
• 20% decrease in false declines, resulting in less customer frustration.
• 50% decrease in fraud basis points for banks utilizing Fiserv's fraud mitigation solutions compared to those not using these tools.

Negative

• None.

Payments and financial technology leader wins FICO® Decisions Award for AI, machine learning & optimization, using advanced fraud technologies

SAN JOSE, Calif.--(BUSINESS WIRE)-- FICO (NYSE: FICO):

Highlights:

• Fiserv wins a 2022 FICO® Decisions Award for fraud management
• Fiserv has reduced fraud losses 10 to 15% for its financial institution clients
• False declines decreased by 20% for banks and credit unions

Fiserv, a leading global provider of payments and financial services technology solutions, has won a 2022 FICO® Decisions Award for AI, machine learning & optimization. Fiserv developed a new fraud mitigation service that has reduced fraud losses, which were already low by industry standards, by 10 to 15% for its small to midsize credit union and bank clients. False declines — legitimate transactions wrongly flagged as fraudulent — decreased by an average of 20%.

Card Risk Mitigation: EnFact® Advanced Scoring from Fiserv builds on FICO® Falcon® Fraud Manager by adding patented neural network modeling technology to deliver real-time detection of suspicious card transactions. The solution brings together the enhanced artificial intelligence capabilities of Adaptive Analytics, FICO® Fraud Predictor and Global Intelligent Profiles, providing a cohesive, complementary and holistic approach. The grouping of these FICO models enables Fiserv to provide a solution that adapts to fraud as it evolves through any client, cardholder, channel, or transaction type.

More information: https://www.fico.com/en/latest-thinking/solution-sheet/fico-falcon-fraud-manager-partners

“The current fast-paced payments environment presents the challenge of mitigating fraudulent transactions while simultaneously reducing cardholder friction,” said Patrick Davie, senior vice president, product strategy, Card Services at Fiserv. “Our clients are seeing excellent results from these new capabilities, both in terms of a marked fall off in fraud, and also in a drop in instances of overly-sensitive risk controls blocking legitimate activity — something that is becoming almost as big of an issue as the fraud losses that traditional antifraud technologies are designed to prevent.”

The new offering keeps up with changes in the value, volume, and timing of transactions. It accounts for changes in merchant categories and transaction locations, which are particularly relevant as card-present transactions decreased at the onset of the pandemic and shoppers quickly gravitated online. The weekly delivery of updated FICO Fraud Predictor merchant profiles ensures Fiserv has the most up-to-date merchant risk data, Adaptive Analytics technology identifies new fraud trends as they emerge, while Global Intelligent Profiles monitors ATM machines to identify high-risk terminals. When combined with the cardholder profiles and FICO’s Behavior Sorted List (B-List) technology, Fiserv protected the cardholder experience by understanding what was “normal”, even as transaction patterns shifted.

Fiserv has documented impressive results:

• 10 to 15% reduction in fraud losses for banks and credit unions relative to their performance prior to using the solution
• An average 20% reduction in the false decline rate reducing customer frustration
• 50% decrease in fraud basis points for banks using Fiserv fraud mitigation solutions compared to those not using these tools

“Fiserv has created an effective new fraud mitigation model in response to a changing market,” said Nikhil Behl, chief marketing officer at FICO. “Smaller financial institutions receive the same cutting-edge service without the onerous overheads. Fiserv has democratized fraud mitigation and demonstrated its continued innovation for its bank and credit union clients.”

“Fraud protection as a service is a compelling idea,” said Sibulelo Ncamani, head of operational risk and governance at Absa Bank and one of the FICO Decisions Awards judges. “Fiserv has combined three technologies so that the sum of these tools is greater than their individual parts. The beauty of the grouping is that it is blended into one, simple to use solution for their customers.”

About Fiserv

Fiserv, Inc. (NASDAQ: FISV) aspires to move money and information in a way that moves the world. As a global leader in payments and financial technology, the company helps clients achieve best-in-class results through a commitment to innovation and excellence in areas including account processing and digital banking solutions; card issuer processing and network services; payments; e-commerce; merchant acquiring and processing; and the Clover® cloud-based point-of-sale and business management platform. Fiserv is a member of the S&P 500® Index and has been recognized as one of FORTUNE World’s Most Admired Companies® for 11 of the past 14 years. Visit fiserv.com and follow on social media for more information and the latest company news.

About the FICO® Decisions Awards

The FICO Decisions Awards recognize organizations that are achieving remarkable success using FICO solutions. A panel of independent judges with deep industry expertise evaluates nominations based upon measurable improvement in key metrics; demonstrated use of best practices; project scale, depth and breadth; and innovative uses of technology. The 2022 judges are:

• Sidhartha Dash, research director at Chartis
• Paul Deall, head of risk, mortgages at Westpac (previous winner)
• Senthil Erulappan, director, product engineering for merchant, risk and collections at FIS
• Armando Junior, general manager, risk and compliance at Dock (previous winner)
• Sheila Leverone, chief marketing officer at eDriving (previous winner)
• Sibulelo Ncamani, head of operational risk and governance at Absa Bank (previous winner)
• Graham Rand, operational researcher and editor of Impact
• Dinesh Suresh, head, digital builds for consumer secured lending at OCBC Bank (previous winner)

The winners of the FICO Decisions Awards will be spotlighted at and win tickets to FICO® World 2022, the Decisions Conference, May 2022 in Orlando, Florida.

About FICO

FICO (NYSE: FICO) powers decisions that help people and businesses around the world prosper. Founded in 1956, the company is a pioneer in the use of predictive analytics and data science to improve operational decisions. FICO holds more than 200 US and foreign patents on technologies that increase profitability, customer satisfaction and growth for businesses in financial services, manufacturing, telecommunications, health care, retail and many other industries. Using FICO solutions, businesses in more than 120 countries do everything from protecting 2.6 billion payment cards from fraud, to helping people get credit, to ensuring that millions of airplanes and rental cars are in the right place at the right time.

Learn more at www.fico.com.

FICO and Falcon are registered trademarks of Fair Isaac Corporation in the US and other countries.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220303005073/en/

Media:

Greg Jawski, Porter Novelli for FICO

1-212-601-8248

Greg.jawski@porternovelli.com

Source: FICO

FAQ

What is the significance of the 2022 FICO® Decisions Award for Fiserv?

The 2022 FICO® Decisions Award recognizes Fiserv's innovative use of AI and machine learning in fraud management, highlighting their successful reduction of fraud losses by 10-15%.

How has Fiserv improved fraud management for financial institutions?

Fiserv has developed solutions that reduce fraud losses and false declines, resulting in better customer experiences for its clients.

What technologies did Fiserv use to win the FICO Decisions Award?

Fiserv's award-winning solutions include the EnFact® Advanced Scoring and FICO® Falcon® Fraud Manager, utilizing advanced neural network modeling.

What are the financial benefits for banks using Fiserv's fraud mitigation solutions?

Banks using Fiserv's solutions report a 10-15% reduction in fraud losses and a significant decrease in false declines.

When was the FICO Decisions Award announced?

The FICO Decisions Award was announced in 2022, recognizing Fiserv's achievements in fraud management.