Elo Reduces Payment Network Fraud by 30% With FICO Fraud Analytics

Brazilian payment network provider wins FICO® Decisions Award for fraud management

Reducing fraud during an e-commerce boom

Elo, one of the largest and most innovative payment providers in Brazil, has used FICO® Falcon® Fraud Manager to reduce fraud by 30 percent for card issuers using its payment network. The best-in-class cloud-based solution also managed to decline online fraudulent transactions and brute force attacks, a significant achievement as e-commerce boomed during the pandemic.

“When the pandemic arrived, FICO Falcon Fraud Manager helped us to continue monitoring transactions and provided our issuers with first-class security, despite changing customer behavior and uncertain times,” said Lori Grandin, fraud prevention head at Elo. “We have over four billion transactions passing through the network each year from 50 million cardholders, so shifting fraud patterns are a significant challenge.”

You can read more about this story in the full media release.

Engendering trust with customers

Prior to the implementation, Elo was experiencing higher fraud rates than the Brazilian market average. To continue its rapid expansion, it was critical to improve fraud detection to engender trust and drive acceptance of its offering.

“We were growing rapidly, and our CEO wanted to invest in a fraud system that could scale with international transactions and e-commerce,” said Grandin.

After a careful search, Elo decided to partner with FICO and chose to implement FICO® Falcon® Fraud Manager fraud detection in the cloud.

Harnessing the intelligence network

A determining factor in this decision was that the solution provided access to the FICO® Falcon® Intelligence Network, a unique and powerful consortium that uses transaction data from over 9,000 global banks to drive fraud-specific machine learning innovation.

Elo decided to deploy FICO® Falcon® Fraud Manager in the cloud, which offered a simpler and more agile implementation cycle. Additionally, operating in the cloud meant that FICO was responsible for updates, ensuring Elo would always have the best and most recent technology, as well as the ability to offer its clients ongoing analytic enhancements.

Democratizing best-in-class fraud technologies

FICO’s fraud advisors worked with Elo and performed an in-depth review of Elo’s data, technology and operational processes. The team developed the initial rules, models, and best-in-class practices. The team developed the initial rules, models, and best-in-class practices. The rollout brought first-rate fraud protection to all its issuers, which was especially important to smaller issuers that couldn’t otherwise afford world-class fraud protection.

“The implementation of the FICO solution has been a significant part of our success,” added Grandin. “It has helped us to develop a strong reputation as one of the most innovative payment providers in Brazil and to continue to grow to a point where we now protect more than 30 issuers on the market.”

“Elo is another FICO customer that has used technology to solve issues brought about by the pandemic,” said Nikhil Behl chief marketing officer at FICO. “They have introduced strict fraud control while balancing this with the user experience. The result has allowed them to continue to grow in a competitive market.”

For its achievements, Elo won a 2022 FICO® Decisions Award for fraud management.

“I was really impressed with the use of high-end analytics at the back-end to provide this service at Elo and the organisational structure with which they executed this,” said Sidhartha Dash, research director at Chartis and one of the FICO Decisions Awards judges. “The scale of the undertaking was not to be underestimated, especially during the conditions of the pandemic."

Payment network fraud

 

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