Form3, an account-to-account platform, has announced a partnership with Feedzai, a market leader in anti-fraud and financial crime software.
This collaboration introduces an innovative authorised push payment (APP) fraud prevention solution, setting a new benchmark in the FinTech sector.
The essence of this partnership lies in addressing the escalating issue of APP fraud, which manipulates victims into making authorised payments to fraudsters. This collaboration is a step forward in leveraging technology to safeguard financial transactions in real-time, thereby protecting consumers and businesses alike.
Form3 is renowned for its cutting-edge account-to-account payment processing capabilities. It provides a platform that simplifies and secures payments, ensuring that transactions are executed swiftly and safely. On the other hand, Feedzai specialises in fraud and financial crime analytics, offering solutions that harness the power of machine learning to detect and prevent fraudulent activities effectively.
Together, Form3 and Feedzai have developed the first APP Fraud Solution built on fully supervised machine learning. This innovative product combines Form3’s robust payment processing framework with Feedzai’s analytics expertise to create a model capable of identifying risks both in the sender and the recipient of payments. By understanding the behaviour of both parties, the solution can detect 95% of fraud attempts at market-standard false positive rates, thereby closing the intelligence gaps exploited by fraudsters.
The need for such a solution is underscored by the near £500m annual losses due to APP fraud and the impending new regulations from the Payment Systems Regulator, which mandate reimbursement to victims of APP fraud by their banks starting October 2024. This partnership not only addresses a critical challenge in the FinTech industry but also aligns with the regulatory landscape, ensuring that banks are better equipped to prevent fraud and avoid significant payouts.
Mike Walters, CEO of Form3, highlighted the importance of collaborative intelligence and advanced technologies in combating APP fraud, stating, “The best way to tackle the rise of APP fraud is the use of collaborative intelligence and cutting edge technologies that allow the real-time identification of scams within the payment message. By bringing together Form3’s payment processing expertise, and Feedzai’s fraud and financial crime solutions, we can tackle APP fraud so that UK banks can make faster payments safer.”
Pedro Barata, CPO at Feedzai, emphasised the significance of the partnership in the face of increasing regulations, saying, “There is increasing regulation in this space, and rightly so – we’ve got to do everything in our power to protect the end consumer from APP fraud. With reimbursement becoming mandatory from October this year, it’s also in the interests of all banks to collectively ensure they prevent fraud and save huge payouts.”
The service is set to go live in April, with a full rollout in the UK market expected by the summer of 2024, ahead of the new regulatory mandates in October.
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