Revolut's new machine learning technology has reduced card fraud fourfold in two months, the company has announced, with the company reportedly getting offers from traditional high street banks to buy the technology.
Rather than rely on security teams and humans checking against card fraud and money laundering, Revolut has developed its own custom machine learning technology to build extensive customer profiles of every customer, to better understand complex financial patterns.
The new machine learning system tackles things such as online card fraud, card cloning and card theft. Revolut says it's seen a fourfold reduction in these since it launched its machine learning in August, which will only improve as the algorithm gets better at detecting card fraud.
Revolut's premium service is designed to attract wealthier customers with features such as travel insurance and cashback. (Image: Ales Nesetril, Unsplash)
Separately, Revolut has also developed machine learning for detecting and preventing money laundering. The mathematical model calculates a unique risk score for every one of Revolut's 3 million users. All transactions are processed by the model, statistically determining the probability of money laundering based on the user's profile. A unique risk score is assigned, and once this value exceeds a certain threshold, the user is required to submit documentation for the activity, which the model uses to recalculate the user's risk score.
Nik Storonsky, founder and CEO of Revolut, commented: "I speak with banks all the time, and several of them have already approached us with offers to buy this technology. What we can accurately display in ten minutes would typically take a large bank over an hour to establish with their current manual processes."
He continued: "If you're on a mission to reach tens of millions of customers and scale your business globally, then you cannot rely solely on human manual processes to effectively protect your customers against financial crime, especially as criminals are becoming more savvy in their tactics."
Whether it be payments, insurance, investment, or loans and credit, Ant Financial's focus isn't on how to support and continue an existing set of technologies, but on how to bring financial services to those who lack them.