A naukri.com initiative
Medium
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Using Generative AI in Card and Payments Fraud Detection
- Financial institutions have traditionally used rule-based systems and traditional machine learning models for fraud detection, but these have limitations like data imbalance and lack of adaptability to new fraud patterns.
- Generative AI offers a more dynamic and adaptive approach to fraud detection by creating synthetic fraud data, excelling in anomaly detection, and automating feature engineering.
- Generative AI enables real-time adaptation to emerging fraud schemes, leading to improved accuracy, reduced false positives, faster detection of new fraud tactics, and better protection for consumers and financial institutions.
- Challenges include data privacy, quality of training data, potential misuse by fraudsters, regulatory compliance, and ensuring explainability of AI decisions.
- The integration of Generative AI in fraud detection systems enhances accuracy, reduces operational costs, and improves customer trust through a more seamless and secure transaction experience.
- Solutions like Featurespace TallierLTM showcase the benefits of GenAI in enhancing fraud detection rates and safeguarding consumers.
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