FICO® Fraud Predictor with Merchant Profiles
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FICO® Fraud Predictor with Merchant Profiles

FICO® Fraud Predictor with Merchant Profiles adds detection power and speed to FICO's industry-leading FICO® Falcon® Fraud Manager solution for card fraud. By capturing the merchant view of transactions, it enables fraud analytics to detect suspicious activity not visible from cardholder behavior patterns alone. Scoring reflects evolving fraud trends and changing risk levels at specific merchant locations.
Key Benefits
  • Reduce net fraud losses by up to 50%
    The addition of merchant profiles increases fraud detection rates without increasing rates of false positives (legitimate transactions scoring above review thresholds). Improve detection on credit cards by up to 50% and debit cards up to 25%.
  • Improve card-not-present and cross-border detection
    For card-not-present (CNP) fraud, analyzing merchant profiles with cardholder profiles can increase detection accuracy by 10%. Because merchant profiles are based on fraud feedback data from global card associations, they also improve cross-border detection.
  • Reduce charge-offs
    When used in real time, FICO Fraud Predictor with Merchant Profiles enables you to prevent many fraudulent transactions.
  • Lower chargeback expense
    Real-time usage also reduces the staff time you devote to processing chargebacks on CNP transactions.
  • Improve customer experience
    Increasing fraud detection accuracy means fewer cardholders are receiving calls from fraud analysts or being inconvenienced at the point of sale.
Feature Highlights
  • Extends FICO's patented profiling technology
    Like cardholder profiles, merchant profiles compress the most predictive variables from immense amounts of historical transaction data into an efficient form for real-time scoring.
  • Analyzes transactions simultaneously against cardholder and merchant profiles
    The Fraud Predictor model analyzes both sides of transaction behavior. It detects abnormal patterns of activity associated with certain merchants, as well as suspicious relationships between cardholders and merchants.
  • Supplies weekly profile updates incorporating global fraud feedback
    Refreshed with information from every transaction—as well as with fraud feedback from global card associations—updated profiles are sent weekly to clients running Fraud Predictor. These frequent updates sensitize scoring to trends, such as growing rates of CNP and cross-border fraud.
  • Generates scores reflecting recent fraud incidence
    Incorporation of fraud feedback information into weekly merchant profile updates enables scoring to adapt to what is happening in the production environment. Transactions will score higher for potential fraud if the merchant or merchant location has been experiencing a high level of actual fraud.

UK Card issuer boosts all its detection metrics

Having substantially lowered its fraud rates with FICO Falcon Fraud Manager, this large UK card issuer was committed to staying at the forefront of fraud detection. Testing FICO Fraud Predictor with Merchant Profiles against its data, the issuer proved it could improve all detection metrics across all false positive rates. For example, at a 20 : 1 account false positive rate, Fraud Predictor boosted the account detection rate (ADR) by 12%, the real-time value detection rate (RTVDR) by 13% and the online detection rate (OLVDR) by 9%.

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