Mastercard deploys artificial intelligence to combat credit card fraud

Mastercard is using artificial intelligence to detect compromised credit cards faster and intercept card data before it falls into the hands of cybercriminals. Generative AI can cross-reference compromised credit card data with geographic clues to pinpoint compromised cards so companies can replace them.

Mastercard’s tool also does the opposite. Artificial intelligence can scour bad card data to identify compromised merchants or payment platforms, and the technology is considered more effective than human-based methods such as database queries. The credit card giant announced that artificial intelligence will play a major role in the rollout of its latest software.

“It’s not surprising that artificial intelligence is being used to analyze credit and debit card breaches,” said Kevin Libby, fraud and security analyst at Javelin Strategy & Research. “Artificial intelligence is well-suited to the task and will undoubtedly increase the speed of analysis, and enables card issuers to stay ahead of criminal activity and block and reissue cards faster, minimizing fraud losses.

dark web

It is estimated that cybercriminals on the dark web have access to billions of credit and debit card numbers. Much of this data is obtained through breaches, but a large amount is stolen by card fraudsters who log card numbers through devices covertly installed at points of sale or ATMs.

Customers often don't know their cards have been compromised, and the breach can go undetected for weeks or longer. Criminals may sell card data on the dark web, causing a delay between the attack occurring and the criminal charging the card. Mastercard hopes artificial intelligence can identify compromises before then, but the new plan may encounter growing pains.

“A less easily solvable problem with proactive payment card blocking is the risk of overreaction and blocking cards that were not exposed during the compromise assessment process,” Libby said. “Because reissuing new payment cards imposes costs on card issuers, it is important to fine-tune the analysis so that the tool correctly identifies all compromised cards while minimizing false positives.”

Advantages outweigh disadvantages

The news comes after Mastercard and Salesforce announced they would join forces to combat fraudulent chargebacks. The work also uses artificial intelligence to identify patterns from large amounts of credit card data. While there will undoubtedly be some problems with the implementation of both types of AI, in the long run the pros outweigh the cons.

“As long as the AI ​​models employed include feedback on which blocked cards end up being used by criminals and which cards don’t end up being used by criminals, I believe these models can be quickly honed to reduce false positives and block faster. compromised cards and reduce losses for all parties involved,” Libby said.

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