Mastercard, a global payments technology company, has announced the launch of its AI-driven financial crime detection solution TRACE (Trace Financial Crime) in Asia Pacific.
The solution has been implemented in the Philippines’ Real-Time Payment (RTP) network in collaboration with BancNet, a local interbank network and the operator of the country’s RTP service, InstaPay.
The Philippines becomes the second market globally to implement TRACE, following the United Kingdom.
The expansion of TRACE into Asia Pacific comes as RTP transactions continue to grow rapidly across the region, allowing individuals and businesses to settle transactions between different financial institutions within seconds.
However, this speed has also made RTP systems attractive targets for money launderers and fraudsters who exploit the system by rapidly moving illicit funds through multiple accounts, sometimes using unsuspecting individuals’ accounts through scams such as romance and investment fraud.
Mastercard is a leading global payments technology firm that provides secure and innovative payment solutions across multiple channels.
The company has been at the forefront of financial security, integrating AI-powered solutions to combat fraud and financial crime.
BancNet, the Philippines’ local interbank network, operates the country’s RTP system, InstaPay, and facilitates seamless transactions between multiple financial institutions.
Traditionally, financial institutions have relied on semi-manual methods or internal AI tools to detect fraudulent activity. However, these solutions are limited to individual institutions’ data, making it difficult to detect widespread financial crime patterns across the network. TRACE addresses this gap by using advanced data science techniques to trace fraudulent transaction patterns across the entire payments network.
The solution provides real-time alerts to banks regarding suspicious accounts and money mule activity, allowing for faster detection and prevention of financial crimes.
BancNet has already onboarded 36 domestic banks onto TRACE, enabling these institutions to trace illicit funds, identify money mule networks, and comply with the Philippines’ new Anti-Financial Account Scamming Act (AFASA).
This initiative enhances financial security and aligns with the country’s regulatory efforts to curb financial fraud.
TRACE is a network-agnostic solution that can be integrated into various RTP systems across the Asia Pacific region.
Mastercard’s AI-powered solution enhances financial institutions’ ability to detect and mitigate fraud, reinforcing trust in digital payments and compliance with regulatory requirements.
The United Kingdom was the first market to implement TRACE in 2018. The solution is currently used by 21 financial institutions, covering 90% of the UK’s Faster Payments Service network. Since its launch, TRACE has identified thousands of mule accounts and continues to help uncover hundreds of fraudulent accounts each month.
“The launch of TRACE in Asia Pacific marks a transformative step toward safeguarding the integrity of Real-Time Payments while combatting the corrosive effects of financial crime,” Mastercard executive vice president, services, Asia Pacific, Matthew Driver, said. “By ensuring that transactions remain secure and compliant, TRACE helps to protect consumers and financial institutions, while also fostering trust in the digital economy—which will be critical for the region’s economic growth. Mastercard is proud to have collaborated with BancNet on its pilot rollout in the Philippines and is ready to collaborate with other stakeholders across the region to implement TRACE to create a stronger, more resilient global financial system.”
“As scams grow more sophisticated, advanced tech-powered prevention and monitoring capabilities are critical. Our partnership with Mastercard and leveraging TRACE gives us and the network participants the intelligence to help detect fraud faster, making scam prevention sharper and more effective,” BancNet chief executive officer, Emmie Reyes, said.
TRACE’s expansion into Asia Pacific underscores Mastercard’s commitment to strengthening financial security on a global scale. As financial crime evolves, AI-driven solutions like TRACE will play a crucial role in detecting and preventing fraudulent activities, ultimately enhancing the security of digital payments.
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