Fraud Management System: prevention in payment systems

The revolution of Financial Transfers across borders continues for an increasingly digitalized, fair, and efficient Europe.

The recent approval by the European Parliament of new regulations on instant payments marks a new turning point in the payments landscape within the European Union.

The recent provisions, which will come into effect 20 days after publication in the Official Journal of the EU, aim to ensure the promptness of money transfers between consumers’ and businesses’ accounts, representing a significant step towards greater financial efficiency and security.

With the new rules, all payment service providers must offer customers the possibility to make instant transfers that take no longer than ten seconds from approval, at any time and day. This will result in almost immediate liquidity for individuals and businesses, promising to significantly improve the daily operations of millions of Europeans. Additionally, the costs of instant payments must not exceed those of regular transfers.

The new regulation also outlines an efficient process for handling multiple orders of instant fund transfers sent in bundles to Payment Service Providers (PSPs), with particular attention to businesses in business-to-business (B2B) payments. When a Payment Service User (PSU) sends a package of instant fund transfer orders, the receiving PSP must immediately split the package, turning each order into individual transactions of instant credit transfer.

Furthermore, currently, payment and electronic money institutions are excluded from the definition of “entity” in Directive 98/26/EC, limiting their participation in instant euro transfers. The regulation aims to include them, allowing them to participate in Payment Systems and contribute to the adoption of instant fund transfers.

Another significant aspect of the regulation is the applicability of the new rules even in member countries that do not use the euro as the official currency, provided their bank accounts support regular euro transactions. This will ensure widespread sharing of the benefits of instant payments, further promoting economic integration among EU countries.

The new regulation emphasizes the importance of anti-fraud measures, requiring payment service providers to implement advanced fraud prevention systems and offering consumers tools to limit risks, such as the ability to set a maximum amount for instant transfers.

One of the main novelties is also the obligation for payment service providers to verify the correspondence of beneficiary names and IBANs for all transactions.

Additionally, the regulation ensures universal access to instant euro fund transfers for all Payment Service Users (PSUs). It states that there should be no disparities in the channels used to initiate instant payments compared to other types of fund transfers.

TAS’s solution for Instant Payments fully covers compliance with the new regulation, with the possibility of adopting the platform modularly and as a service.

Thanks to ur long-standing relationships with most Italian banks, TAS has become a leader in Instant Payments solutions in Italy and has in-depth market knowledge and a unique ability to meet the needs of financial institutions in the product adoption journey.

With its expansion across Europe, TAS is well-positioned to drive innovation in the instant payments sector, offering a comprehensive, modular, and innovative solution that meets the needs of Italian and European banks.

Our commitment is indeed to be a true partner for banks, working closely with them to understand and meet their specific needs.

The modularity of the solution allows banks to choose only the necessary components and design a tailored architecture based on their specific requirements. Additionally, our solutions are based on a modern architecture designed to ensure complete service continuity, with real-time operations 24 hours a day.

Our offering model is based on a very flexible approach and can be implemented in the cloud, on-premises, or in SaaS mode, allowing for rapid and effective time to market.

Key features of TAS solution:

• Full compliance with SEPA Inst protocol requirements: complete processing time <10 sec., Timeout management.
• Cloud-native platform: for a turnkey offering with real-time 24 × 7 operations.
• Omni-channel: corporate portal, retail banking, back-office, etc.
• API interfaces: for payment initiation, reachability, and message requests.
• Message enhancement: message data enrichment through integration with core banking.
• Message screening: message verification through integration with screening systems (e.g., AML, Fraud, etc.).
• Message pairing and r-messages: Pairing of related messages and management of r-messages.
• “Four Eyes” principle: workflow can be defined with multilevel approval processes wherever necessary.
• Error alert: notifications can be sent in case of errors.
• Scalability and fault tolerance: the solution ensures full vertical and horizontal scalability.
• Certified full SWIFT message interface: the message network interface is a fully certified SWIFT application.

Contact our experts to find out how TAS can support you in implementing fast, effective, secure, and fully compliant solutions with the new regulations.

We continue to invest in innovation within the payment sector by introducing advanced artificial intelligence (AI) solutions aimed at significantly improving efficiency, security, and overall user experience.

Now available on our website is an intelligent chatbot named LIA, designed to respond to user inquiries quickly and efficiently. This is just one example of our innovation journey focused on two main areas: integrating advanced AI-based features into our products and optimizing internal processes through the effective implementation of AI.

Enhanced Security with “Fraud Protect”
Security in payment systems is an absolute necessity, especially in the digital context that poses continuous challenges and threats. “Fraud Protect,” our fraud management solution, now incorporates advanced AI technologies to identify suspicious transaction patterns, significantly enhancing fraud prevention and anti-terrorism security. Additionally, the introduction of the intelligent chatbot “IVIC,” which engages with users in potential risk situations, improves customer experience and helps reduce false positives.

Optimized Transaction Processing and Reconciliation
AI plays a crucial role in automating transaction processing and reconciliation processes. By reducing manual errors, we increase operational efficiency, ensuring greater accuracy in transactions. Predictive analysis plays a fundamental role in managing transaction peaks, allocating resources more efficiently. TAS’s Banking Treasury product is evolving to implement AI-based predictive treasury models, capable of predicting liquidity needs in real-time, even on an intraday basis.

Global Impact of Artificial Intelligence in Payment Systems
We believe that the use of AI in the production process of payment systems has become essential and capable of influencing productivity, quality, and product innovation. From transaction processing to project management to customer support, AI is transforming every aspect of the process, opening new horizons in an ever-evolving industry. That’s why we continuously invest in integrating new AI-based technologies into our products to stay ahead and ensure increasingly effective and secure payment solutions.

TAS Lab is our new research department which aims to continuously invest in innovation in the financial sector. The purpose of TAS Lab is to design technologically advanced solutions that improve how people use financial services, developing state-of-the-art products to provide banks and companies with a competitive advantage in the market.

The department currently focuses on three main research areas: quantum computing for payment fraud prevention, the development of a new phygital model of bank branches (TAS Remote Teller) and the applications of artificial intelligence to the world of payments.

Quantum computing is an emerging technology that promises to revolutionize the way data and financial transactions are handled. TAS Lab, together with the University of Verona (Italy), is exploiting this technology on concrete use cases to develop advanced solutions for the prevention of payment fraud, which allow banks and financial institutions to manage payment transactions more securely and efficiently.

The phygital bank branch, or TAS Remote Teller, represents a new frontier in the banking sector, which combines the advantages of physical presence with the convenience of digital technology. TAS Lab is exploring how this technology can be used to improve the customer banking experience, guaranteeing the physical presence of streamlined branches on the territory with virtual assistance that allows the user to carry out all the banking operations of a traditional branch in a simple and fast way.

Finally, TAS Lab is investing in artificial intelligence, developing advanced algorithms and machine learning technologies to improve data management and financial transactions.

If you are a research institution, a company or an individual with a passion for technology and innovation and are interested in collaborating with TAS Lab, please get in touch with us to submit your idea. The department is always looking for new projects and solutions.

Contact us at solutions@tasgroup.eu to find out how we can create the future of financial services together.

To write this article we used the artificial intelligence of Chat GPT, starting from our ideas💡.

Cyber attacks suffered by companies and institutions of any industry, including the Finance sector, are constantly intensifying. Statistics show a clear unstoppable increase in both the volumes and the severity of events caused by more and more sophisticated and organized actors. No doubt that cyber- ​​and data-protection are today a top priority for all financial ecosystem companies. In this context, TAS has recently signed two important agreements, the first at Group level with Synopsys and the second with Acronis through the French subsidiary TAS France. The adoption by TAS’ Software Factory of the flagship suite of Synopsys, a leading American company in Application Security Testing, will guarantee the development of secure code using advanced BSIMM (Building Software In Maturity Model) tools and methodologies, further increasing the security of the software provided to our customers. On the other hand, the hosting and cloud computing services delivered by TAS France combined with the management and information security solutions of Acronis, a global leader in cyber protection, will offer an undeniable added value to the customers served by the Sophia Antipolis Data Center: improved customer experience enhanced with greater security and cyber resilience. Find out more about the TAS & Synopsys agreement  Learn more about the TAS Cloud Services & Acronis agreement 

WEBINAR

Detecting fraud within payment systems is one of the top challenges for IT organizations. Integrating fraud detection applications with payment systems can be complex and impact SLAs. IBM and TAS/Mantica have just simplified this effort.

IBM has partnered with TAS/Mantica to bring together the power of their Adaptive Intelligence Platform and Fraud Protection Solution with IBM Watson Machine Learning for z/OS. This impressive combination helps organizations monitor and detect payment fraud in real-time, before a transaction completes, with minimal impact to SLAs.

TAS/Mantica models can be readily deployed through the Watson Machine Learning for z/OS scoring service. The sophisticated models can help organizations drastically reduce the implementation effort of a customized fraud prevention/detection system.

Watson Machine Learning for z/OS scoring includes RESTful APIs and Java and CICS integration that benefit from the high security and performance of the IBM Z platform. Mantica Spark and customized machine learning models, ported to Watson Machine Learning for z/OS, enable scoring directly within an IBM Z application. IBM testing showed performance, measured against different CPU capacity, revealed single-digit millisecond response times and a complete exploitation of available specialized engines. The solution also maintains model quality and performance over time as new fraud patterns emerge.

Join this IBM webinar to learn how these innovative technologies help deliver valuable insight, at the point of transaction, by readily deploying fraud detection models within IBM Z transactional payment applications.

The webinar will be presented by Eberhard Hechler, Executive Architect, IBM and special guest speaker Amedeo Borin, CEO Mantica Italia.

Watch on demand

Optimize the buying experience, increase sales, reduce fraud

As online fraud continues to grow a pace, a trend that has been accelerated by the pandemic, effective, smart, frictionless customer authentication is now vital.

In this white paper we explain how 3-D Secure 2 (3DS2):

– optimizes the buying experience, increases sales and reduces fraud
– offers a smart way to support SCA and SCA exemptions
– has evolved and the key differences between 3DS 2.1 v 2.2
– enables you to turn compliance into a better customer experience.

Download White Paper

Detecting fraud within payment transactions in real-time is one of the top challenges for many IT organizations. IBM and TAS/Mantica have joined their efforts and brought together a solution to help organizations to monitor and detect fraud in real-time within their payments systems with minimal impact on SLAs. Join the webinar to learn how you can apply this powerful machine learning based-solution to your payment processes. The webinar will be presented by Eberhard Hechler, Executive Architect, IBM and special guest speaker Amedeo Borin, CEO Mantica Italia. REGISTER TODAY Download Webinar Details Discover more about MANTICA Adaptive Intelligence Platform, the most effective platform for predictive models, that helps monitor and detect fraud in real-time, exploiting Machine Learning and Big Data technologies. Mantica Adaptive Intelligence Platform is already integrated with Fraud Protect solution by TAS Group.