Why Machine Learning needs to be self-service to beat payment fraud

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My colleagues and I are often left bemused when we hear claims, from fraud experts from across the world, that machine learning is set to change a business function or disrupt a market. Surely, to be really disruptive you have to put the tools in the hands of the customer so they can model and implement the findings immediately. Adding additional 3rd party manual intervention flies in the face of adopting machine learning.

Dr Mark Goldspink, CEO of The ai Corporation

The truth is that machine learning within the fraud prevention world is not new. However, as we have referenced many times in the past, it’s clear that the evolution of the point of sale (POS) means that machine learning/A.I. must now be adopted to successfully manage payment fraud. Nowhere is this more important than in the CNP segment which is growing rapidly globally.
Over the past 3-4 years there has been a series of newcomers entering the payment fraud market. Many of those providers are using newer technologies, or have developed improved solutions, that are financially affordable and, therefore, more accessible to more business organisations. My team and I have done the same, we have expanded our historical rules engine based fraud products and augmented them with machine learning tools. We have also adopted off the shelf technologies, in order, to make our products affordable. However, unlike these newcomers, we have taken it one step further. We have designed our solutions to make them easy for our customers use themselves and not rely on a 3rd party supplier. To me that’s the key to enabling machine learning to beat payment fraud.

Consumers expect companies to keep improving their level of service. They want their questions answered and problems solved in a timely, friendly, and efficient manner. Consumers, quite rightly, have a strong aversion to having to contact a company several times or sharing the same information more than once.

With a self-service strategy, it’s useful to consider every single step in the customer relationship, because a self-service model relates to the pre-purchase phase, as well as to the purchase, and any questions that may arise following the purchase.

Take pre-sales, consumers make their own enquiries regarding a purchase. Quite often, 70% of the decision has already been made before a consumer contacts a company; 27% prefer to ask commercial questions over the phone; whereas 56% opt for the self-service approach.

In terms of sales, the exponential growth of e-commerce shows that more and more people want to stay in control of the purchase process. Post sales and the back office has typically not had the investment, but customers are using the phone less and less in call centres in preference to the web/IVR.

4 reasons why self-service is so appealing to customers?

Self-service is faster. A problem that customers have when using an assisted service, is that they must go somewhere to use it and have to wait in line in order to get the service they need. This might be due to there not being enough assisted service workers to help customers efficiently. This ratio of workers to customers can lead to customers waiting from several minutes to hours for a service that they may need instantly. When they finally get to the booth, customers may not fully be engaged, due to their impatience caused by waiting in line.

Self-service empowers customers to take charge in how they use a service. In today’s marketplace, there are many types of mobile applications that track different aspects of our lives. Health-monitoring applications are one of the most popular types of apps among consumers. But what makes customers download these applications? Wouldn’t they rather use the same methods that health professionals use to take vitals before a doctor’s appointment?

With self-service, there’s less room for error. Even well-trained, experienced workers can make mistakes when interacting with the customers. For example, a common mistake that baristas make is mishearing the customer’s order, especially during rush hour, where baristas are trying to serve many customers in a short period of time. Mishearing a customer’s order can lead to orders being mixed up, and increases the number of irritated customers.

Self-service creates a more personal experience. In the assisted service industry, a “one-size-fits-all” type of approach is used to help customers. All customers are treated the same during transactions, not considering the different types of needs that each customer has. For example, some customers may want to skip steps if they feel that they have already done some steps in advance, such as confirming an address, that they had already updated a few days before. Other customers may be in a hurry, and they might feel that the process is too slow for their pace.

The self-service revolution is all about enabling customers to control all aspects for their life. Self-service is the only long-term solution to meeting customer expectations. Already, 70% of consumers expect a self-service option for handling commercial questions and complaints. Still, this doesn’t preclude the need for a personal solution: If self-service falls short, personal contact as a safety net is an absolute necessity.

So, what are you waiting for? Take the common-sense approach and let your customers to take control.

Founded in 1998, ai has a long track record of providing solutions to some of the world’s largest financial/payment institutions and international merchants. ai’s successful longstanding business partnerships are based on making things simple, self-service tools that allow our customers to take control.