Feedzai: Comprehensive Analytics for Fraud Management

Nuno Sebastiao, Co-Founder, Chairman of the Board & CEO, FeedzaiNuno Sebastiao, Co-Founder, Chairman of the Board & CEO
"Error! Your account has been hacked!” The popup message that appeared recently on several computers threatened banks and financial institutions around the world. The banking malware spurred from a sloppy phishing campaign breached the network of leading banks, logged into online banking and wiped the cash out of customers’ accounts.

Such incidents prove that no state, enterprise, or private entity is secure against a crippling data breach. As cyber attacks continue to plague businesses, banking domains encounter almost three times more cyber attacks than any other industry. As fraud attackers become more sophisticated and insidious, protecting information proves to be a great challenge for banks of all sizes. The new fraud threats require mitigation strategies that extend well beyond the capabilities of conventional payment fraud prevention software. Besides, the majority of organizations lack security experts and state-of-the-art technology to secure their crucial network infrastructure and data. Most existing fraud solutions are inflexible and not built for today’s line of business, and are not easily reconfigurable to support emerging omnichannel commerce.

Drawing on years of experience in the cybersecurity landscape, an industry veteran, Nuno Sebastiao, along with his fellow co-founders Paulo Marques and Pedro Bizarro, laid the cornerstone of Feedzai in 2011 to protect largest banks from fraudsters. Governed by a mission to spark innovation in the banking domain, Feedzai provides holistic solutions that enable retail banks to manage risk and keep themselves and their customers safe from fraud across all channels. The company’s agile, flexible, and hyper-efficient technology platform allows banks to take a starkly different approach to enhance fraud detection and prevention. “We are committed to making banking and commerce systems safe worldwide, freeing our business customers to securely transact with their consumers anywhere and anytime,” states Sebastiao.

Identifying Fraud in Real-time

Feedzai’s end-to-end solutions comprise fraud management and anti-money laundering products that enable banks to accurately analyze their information to keep the customers’ data and transactions safe at any place or moment in time. Integrated with machine learning, Feedzai’s fraud management platform is instrumental in transforming the management of risk and fraud into a real-time decision science to help banks prevent fraud in omnichannel commerce. The machine learning models rapidly learn from every transaction and combine with data-agnostic systems to enable banks to integrate data from any external source to build insights around customer history and activity.

Subsequently, the large data sets are processed in a few milliseconds to uncover fraud patterns and deeply learn personal behaviors, ensuring greater accuracy than segmentation or sampling data approaches. The platform has a risk engine at its core that creates hyper granular customer profiles to accurately assess every single customer’s risk. By processing the hyper granular profiles in real time, data scientists can understand the precise entity behavior at any moment in time. In order to improve accuracy in predicting fraud, the hyper granular risk profiles and transactions are scored in real time using a combination of rules and machine learning models. Feedzai’s machine learning then works to process events and transactions in milliseconds and delivers explainable AI by adding a human-readable semantic layer to the underlying machine logic. With human-friendly white box explanations, fraud analysts can efficiently review transactions and make decisions to meet compliance standards. By leveraging Feedzai’s technology, customers can reap better fraud prevention, streamlined operations, and improved customer experience.

Further, the company also provides an anti-money laundering (AML) solution that helps banks to manage reputation, balance compliance and cost by enforcing anti-corruption laws. Feedzai’s AML offers new capabilities that allow banks to assess the risk of customers and their transactions while reducing operational costs with automated case management tools and compliance reporting.

We are committed to make banking and commerce systems safe worldwide, freeing our business customers to securely transact with their consumers anywhere and anytime

Driven by artificial intelligence, Feedzai AML takes a risk-based approach and works for every customer channel.

Unified Analytics Engine

Feedzai’s machine learning platform makes connections from different attack vectors and compares the baseline to the velocity of various transactional updates to score in real time. The profile engine calculates and maintains thousands of granular profiles that trigger an alert when suspicious account activity happens. For example, Feedzai analyzes login attempts, changes in device settings, suspicious device configurations, multiple shipping addresses, and buying behaviors to identify suspicious behaviors. With a comprehensive solution of rules and machine learning, Feedzai is able to prevent account takeover fraud, whether it is from a human or bot.

With Feedzai’s fraud management solutions, bankers can streamline the enrollment process for banking services like checking accounts and credit, debit, and prepaid cards. As PSD2, a payment service directive is poised to level the playing field in the banking space, banks today are looking for ways to stay compliant and enhance customer satisfaction. To address this, Feedzai has come up with a purpose-built fraud solution designed to help banks manage risk without introducing additional layers of inconvenience to the customer. With features like PAN Tokenization and 2 Factor Authentication, Feedzai is always up to date with the latest regulatory standards. The machine learning-based models allow banks to easily adapt to known and unknown types of fraud, and constantly evolve along with the fast-moving threat landscape. Banks can unlock the power of data, both external and internal, and create a balanced approach to risk management, one that delights customers and fights fraudsters.

Feedzai’s Fraud payment prevention is a real-time, big data operational intelligence platform that integrates streaming data with historical information. This platform leverages optimized in-memory analytics engine for real-time streaming and computing of structured, semi-structured, and unstructured data. The comprehensive view of all available data includes historic profiles of users, cards, merchants, and fraud cases, which will be used while scoring a transaction. The platform also generates real-time reporting on global fraud trends and operational metrics through intuitive reports and visual dashboards that help managers to make better decisions.

The New Paradigm for Fraud Management

The company understands that every business has different needs, and knows the importance of providing an agile solution. As a response to this need, Feedzai is committed to offering several deployment methods that include on-premise, cloud, or hybrid. Feedzai can be completely installed on-premise and scaled as the business grows. Whether deployed as an appliance on-premise, as a service, or as a hybrid appliance service model, Feedzai’s machine learning models can be trained to actively detect fraud within hours. There is no follow-up service engagements required to fine-tune rules because the models can self-update.

With such a powerful platform, the company delivers next-generation fraud technology that gives real utility to data feeds that come from new and unexpected sources. Feedzai is looking at commerce transactions as an ecosystem model and is disrupting conventional thinking about risk and pioneering a new approach to risk management.

Today, under Sebastiao’s leadership, Feedzai is growing in leaps and bounds while continuing to keep commerce safe for numerous leading banks, retailers, and payment processors around the globe. For the road ahead, the company is en route to expand their brand further in APAC. Along the path of expansion, “We’re doubling our engineering and innovation team. And I think our clients not only will like that, but they will end up buying more from us for other use cases, such as anti-money laundering, or account takeover.” In conclusion, Sebastiao says “As we gain more traction in APAC, you can bet that 2018 will be another transformational year for Feedzai.”