In the never-ending battle to protect customers and institutions from fraud, more and more financial institutions (FIs) are deploying machine learning (ML) and artificial intelligence (AI) tools to fight back.
And, according to PYMNTS Intelligence, “Stop fraudsters with AI and MLThis is a collaborative report with “. hawkand those efforts appear to be working.
The report, based on a survey of 200 financial institutions with more than $1 billion in assets under management, found that: Them Financial institutions that are currently using ML or AI to mitigate fraud are seeing a significant reduction in common forms of fraud.
For example, technical support impersonation scams and IRS impersonation scams are two of the most egregious scams. frequently reported However, financial institutions using ML or AI fraud prevention solutions are 17 more likely to report encountering these major frauds than those relying solely on traditional fraud prevention tools. % was low. Similarly, they were 18% less likely to report IRS identity fraud as their top concern.
They also reported lower rates for lottery tickets, romance, utilities, and rentals. and Social Security fraud. in fact, As the figure shows, financial institutions ML AI technology has been reported to reduce the incidence of almost all common frauds.
The data also shows that both ML-based and AI-based solutions have room for improvement. The tool had less success in identifying charitable donation scam. We also miss fake debt collection scams. This may be because these two scams are less common (and therefore have less data to base their solutions on).
Despite these small hurdles, financial institutions Apparently Impressed: 52% of financial institutions we surveyed plan to adopt or increase their use of ML or AI fraud prevention models. in fact, Financial institutions using AI and ML are 17% more likely to plan to implement additional ML and AI solutions than those without ML and AI fraud prevention solutions. In other words, many financial institutions currently using ML and AI are Senior Technology is poised to scale ML and AI tool chest.
Our research also found that financial institutions adopting ML or AI fraud prevention models not only stop more bad actors from causing damage, but also give customers more confidence that their accounts are protected, so customer satisfaction is likely to improve as fraud levels decrease.
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