Mastercard deploys artificial intelligence to preemptively stop credit card fraud

Mastercard has announced its latest strategy to combat credit and debit card fraud as part of an upcoming software update. Utilize artificial intelligence detection mode to identify stolen card numbers before they fall into the hands of cybercriminals.

“Generative AI will allow us to find where your credentials may have been compromised, determine how it happened, and quickly resolve the issue for you and other customers who don’t yet know they were compromised,” explains Johan Gerber. According to the Associated Press, Mastercard’s executive vice president of security and network innovation said in an interview.

Mastercard's new update leverages contextual information such as geolocation, time and address, as well as compromised credit card numbers found in its database.

The technology can also track compromised batches of cards to identify vulnerable merchants or payment processors. Gerber points out that this kind of pattern recognition is beyond the capabilities of traditional methods, which rely on human-led database queries.

The dark web is filled with billions of stolen credit and debit card numbers available for purchase by criminals. These numbers are typically stolen from merchants during data breaches, but many are also stolen from consumers who inadvertently use their cards at compromised gas stations, ATMs, or online merchants.

Often, stolen cards can go undetected for long periods of time, only to be discovered when payment networks scan the dark web, merchants report breaches, or criminals use the cards. Mastercard’s new AI-driven approach is designed to proactively identify and replace compromised cards, minimizing disruption to consumers.

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The payments industry is gradually transitioning from “static” card numbers (permanent numbers universally used by all merchants) to unique numbers for specific transactions. However, this transition could take years due to the slow adoption of new payment technologies.

Mastercard's artificial intelligence update coincides with efforts by its chief rival Visa Inc. to modernize payments. Visa recently announced major changes to its U.S. credit and debit card business, indicating that physical cards and static 16-bit numbers will be eliminated in the future.

As the payments industry evolves, Mastercard's integration of artificial intelligence represents an important step in enhancing security and reducing fraud, promising a safer and more efficient experience for consumers and financial institutions.

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