HSBC is fighting card fraud with the global rollout of a real-time Fraud Management system co-developed with SAS.
Initially focusing on debit and credit card fraud, the vision is for the system to handle all types of transactions, including those by internet, telephone, and checks, as well as gather non-payment information. It said this will give the bank a single, integrated view of customer behavior that isn’t possible with the silos of data currently housing debit, credit, and other customer information today.
The ultimate aim for this solution is to give us customer details and give us a view of what’s going on in that customer’s account be that debit, credit, checks, or non-payments, said Derek Wylde, head of group fraud risk at HSBC.
The advanced neural network models at the heart of SAS Fraud Management allows HSBC to identify and react far faster to unusual customer behavior. Call-center staff have more accurate information to follow up suspicious looking transactions using the new system, while fewer false positive results means customers are not contacted unnecessarily.
HSBC has already been using the system for three months in the US to deal with credit card transactions, resulting in a 10% rise in the number of cases agents investigated. Next stop on the global rollout is the UK, with the credit card system going live in Q2 and debit in Q3. This will be followed by Asia, the Middle East, Latin America, and Canada.
A side benefit of gathering all this transactional data together is that the marketing department will have a better picture of customer behavior to target their campaigns.
SAS intends to sell the system to other banks. Both the analytics vendor and HSBC hope that this launch will unite the banking industry to combat card fraud, which last year cost the industry $4.84bn.
We want to bring together a consortium of financial organisations to share that goal, said SAS CEO Jim Goodnight.