Mastercard collaborates with Feedzai to prevent fraud

21 November, 2023 - 1:12 pm (14 days ago)
1 min read

In a groundbreaking move, Mastercard has teamed up with Feedzai, a regulatory technology platform known for using artificial intelligence to combat online financial scams and money laundering. This collaboration aims to significantly bolster fraud detection and prevention in the realm of cryptocurrency transactions.

Innovative Integration for Enhanced Security

Central to this partnership is the integration of Feedzai’s technology with Mastercard’s CipherTrace Armada platform. This platform plays a crucial role in assisting banks to monitor over 6,000 cryptocurrency exchanges for potential fraud, money laundering, and other suspicious activities. Unlike conventional methods, CipherTrace Armada will be embedded directly into Feedzai’s system, enabling real-time alerts for dubious crypto transactions. This synergy is expected to elevate fraud detection, safeguarding consumers and identifying potential money laundering activities and mule accounts, as stated by Nuno Sebastio, Feedzai’s CEO.

The Scale of Crypto Scams

Alarmingly, around 40% of scam transactions today transition directly from bank accounts to crypto exchanges. This statistic underscores the urgency and necessity of robust fraud detection mechanisms in the financial sector.

Feedzai’s AI Expertise

Feedzai, a leader in the field with its RiskOps platform, analyzes transactions totaling over $1.7 trillion annually. The company’s prowess in artificial intelligence is set to offer Mastercard an edge in identifying and blocking suspicious transactions swiftly while ensuring legitimate transactions proceed unhindered.

Banks’ Cautious Approach Towards Crypto

Despite growing interest in cryptocurrencies, banks have remained cautious, primarily due to the lack of comprehensive regulations and the perceived risks of fraud and scams. The recent surge in crypto-related losses, with a 79% global increase last year, has only heightened these concerns.

Mastercard’s Network and Competition

Mastercard, a global giant in payment processing, faces competition from Visa and other fintech service providers. However, its vast network and this latest partnership position it strongly in the fight against crypto fraud.

In the UK, banks have been hesitant to engage with crypto, with several leading institutions halting transactions with crypto exchanges due to fraud risks. This has led to criticisms from prominent figures in the crypto industry, highlighting a discord between regulatory caution and the push for innovation.

Ajay Bhalla, President of Cyber and Intelligence at Mastercard, emphasized the balance of risk and opportunity in the increasingly digital financial landscape. He revealed that fraud in crypto transactions is notably higher than in regular fiat transactions, stressing the importance of the partnership with Feedzai in distinguishing between legitimate and fraudulent activities.

The collaboration between Mastercard and Feedzai marks a significant step in the fight against financial fraud, especially in the burgeoning field of cryptocurrency. It represents not only a technological advancement but also a strategic move to instill greater trust and security in the financial ecosystem, addressing both current challenges and future potentials. As the digital financial landscape continues to evolve, such partnerships will be pivotal in shaping a safer, more reliable world of online transactions.

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Disclaimer: The information provided in this article is for informational purposes only and should not be considered as financial, tax, or investment advice. It is always recommended to consult with a qualified financial advisor before making any investment decisions. The author and are not responsible for any actions taken based on the information provided in this article. Past performance is not indicative of future results. Investing involves risks, including the potential loss of principal. Always do your own due diligence before making any investment or financial decisions.

Bilgesu Erdem

tech and internet savvy, cat lover.

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