MasterCard Activates Real-Time Intelligence to More Accurately Predict Fraud

MasterCard unveiled MasterCard IQ series, a suite of pioneering solutions that use real-time intelligence to empower issuers to make more informed fraud management decisions.

Through this effort, cardholders and merchants would see a reduced number of transactions unnecessarily declined, while maintaining the highest levels of security. Javelin estimates that one out of every six cardholders experienced at least one decline because of suspected fraud in the past year.

“While the industry has relentlessly worked to reduce fraud, some of these efforts have resulted in an increase in transactions being needlessly declined,” said Ajay Bhalla, president of Enterprise Security Solutions, MasterCard. “Nobody likes being falsely accused of something. Our IQ products leverage technology and insights to deliver merchants and consumers a convenient, uninterrupted checkout experience.”

At launch, the MasterCard IQ series will include two core products providing insights into cardholder spending habits in a split-second:

  • Authorization IQ – provides issuers with segmented account spending insights to help them make more informed authorization decisions. Unique and historical behavior of the card is used to predict and assess risk against a current transaction, decreasing false declines.
  • Assurance IQ – enables the exchange of vital information from the merchant about the circumstances of a transaction. This enables MasterCard to provide a blended risk score about the transaction to the issuer, enhancing confidence in the approval.

The Issue of False Declines

  • The value of false declines per year has hit $118 billion – more than 13 times the total amount lost annually to actual card fraud ($9 billion), according to Javelin research.
  • More affluent cardholders account for half of all false declines, as they tend to spend more, more often, especially when traveling.
  • If falsely declined, cardholders tend to change attitudes around the card and retailers; 39 percent abandon that card after a false decline, while a quarter decrease card usage.  In addition, 32% say they plan to stop shopping at the retailer where they were declined.

The new MasterCard IQ series – the latest tier in the company’s multi-layered approach to tackling safety and security – is available globally and supports all MasterCard brands and products.

At MasterCard, safety comes first, as demonstrated by a long history of leading the industry through investment and innovation that delivers multiple layers of technology – like EMV, tokenization, biometrics, location alerts,MasterCard Safety Net – to protect each and every transaction. As a result, MasterCard has become the safest, simplest and smartest way to pay.