Bank of New Zealand

GROWING FRAUD REQUIRES NEW APPROACH

Many conveniences that customers enjoy as a result of modern banking carry an increased risk of fraud. Global card fraud losses are on the rise—from 2016 to 2025, they are projected to nearly double, climbing from US $22.8 billion to nearly $50 billion. Mobile banking is particularly vulnerable as 65% of fraudulent transactions were perpetrated through a mobile browser or mobile app according to a recent study.

Legacy systems were designed to see and stop easily recognisable, repetitive fraud patterns, however modern “anytime, anywhere” banking on mobile devices has made fraud detection much more challenging. Banks’ time to respond is also shrinking as real-time payments mean there are just milliseconds to detect and prevent theft before transactions are done.

PROTECTING CUSTOMERS AND THE CUSTOMER EXPERIENCE

BNZ understands the importance of providing solutions that meet its customers’ expectations for convenience while also ensuring that state-of-the-art security is in place, capable of withstanding increasingly sophisticated cyber-attacks and large-scale fraud breaches. To do so, BNZ selected IBM Safer Payments, a modern real-time fraud detection solution that allows banks to intercept fraudulent activity before it happens, while ensuring customers’ genuine transactions are not stopped in error. IBM Safer Payments uses machine learning and artificial intelligence to analyse behavior and fraud patterns, build and adapt models to deter emerging fraud threats, and recommend countermeasure responses.

“We are ruthlessly vigilant in protecting our customers’ trust in us, and we put security front and center, so they can be sure their money and personal information is well-protected. With IBM Safer Payments, we are stepping up this protection, analysing every transaction in real time, but without sacrificing the customer experience. Everything we do to protect our customers from fraud and cybercrime also helps us contribute to upholding New Zealand’s excellent e-commerce and trading reputation globally.” – Owen Loeffellechner, Chief Safety and Security Officer, BNZ

LOOKING BEYOND JUST TRANSACTION FOR GREATER CONTEXT AND ACCURACY

IBM Safer Payments uses both financial and non-financial data together with a customer’s transaction history, to perform rigorous authentication and profiling on each and every transaction. Potentially fraudulent transactions are quickly identified – allowing them to be stopped or put on hold pending further validation. The solution also complies with all credit card scheme rules. “Banks are facing the challenge of needing to adapt to meet their customers’ evolving expectations for a frictionless transaction, while also ensuring their security,” said Mike Smith, Managing Director of IBM New Zealand. “With financial crime becoming increasingly sophisticated, BNZ partnered with IBM to address the rising threat of crime and fraud while still enabling top quality experiences for customers and allowing for future growth.”