Denmark’s Danske Bank has selected Think Big Analytics, the consulting arm of Teradata, to develop and launch a new fraud detection platform based on artificial intelligence (AI) technology.
The platform uses machine learning to analyse thousands of latent features, scoring online banking transactions in real-time to offer actionable insight regarding true, and false, fraudulent activity.
Danske Bank head of advanced analytics Nadeem Gulzar said: “Application fraud is a critical, top of the agenda issue for banks, and there is evidence that criminals are becoming savvier by the day; employing sophisticated machine learning techniques to attack, so it’s critical to use advanced techniques, such as machine learning to catch them.
“Using AI, we’ve already reduced false positives by 50% and as such have been able to reallocate half the fraud detection unit to higher value responsibilities.”
The bank’s original fraud detection system was primarily based on handcrafted rules.
“With record numbers of false positives – at times reaching 99.5% of all transactions – the costs and time associated with investigation had become significant, with the bank’s large fraud detection team feeling overworked, yet not effectively utilized,” the technology vendor said.
Think Big Analytics team has been working with Danske Bank since 2016. The combined team has developed advanced strategies to detect fraud involved in transactions and ensure transparency.