The results of Featurespace’s pilot with Pay.UK demonstrates the potential for national payments systems to help combat fraud. The overall pilot exceeded expectations. Participants’ results reveal an average uplift of more than £112m worth of additional fraud detected in a year.
Featurespace significantly outperformed this average, achieving an uplift of £138.7m (43% of the missed fraud from incumbent fraud systems) at a 5:1 false positive ratio (within the data received). The initiative trialled a new overlay service. This will allow all UK banks, building societies, and payment service providers (PSPs) to analyse money flows. It utilises Featurespace’s adaptive behavioural analytics to proactively detect fraud and help prevent crime before it occurs, safely and securely.
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Cases of Authorised Push Payment (APP) fraud jumped by 12% from 2022 to 2023, with total losses amounting to £459.7m.
Featurespace analysed data from participating banks, building societies, and payment service providers (PSPs) under a UK-first data-sharing agreement enabling Pay.UK’s ‘consortium’ model within their ARIC platform.
Featurespace TallierLTM: successfully boosting fraud detection
Post completion of the pilot, Featurespace ran the data through its Generative AI innovation TallierLTM. It was able to increase fraud detection to 56% at a 5:1 ratio. It says that using this new approach has positive long-term implications for fraud detection.
Kate Frankish, Chief Business Development Officer and Anti-Fraud Lead at Pay.UK, said: “The positive results from this pilot demonstrate the importance of innovation and cross-industry collaboration in developing effective solutions to stay ahead of fraudsters and protect people in the ever-changing payments landscape. In 2023, the UK saw 232,429 people falling victim to fraud. To reduce the scale of the crime that is happening we need a unified approach, and this future service will be a major step forward.”
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By GlobalDataMartina King, CEO at Featurespace, added: “Fraud is the single largest crime in the UK. It accounts for 40% of all crime and contributes to £2.3bn in losses annually. But the UK is leading the charge to tackle this issue. The game-changing pilot with Pay.UK is one that the world has been watching. It shows the immense power of collaboration and technology. And the scale of positive change that is possible when the payments industry works together to tackle fraudulent activity.”
