Conversational AI in Fraud Management: Can your Bots keep your Customers safe?

It is no secret that as the global banking system sees the volume of digital banking transactions increase, the more cases of fraud we witness (and even experience). Digital fraud attacks increased 109% in the US alone, and globally fraud attempts in banking were up to a whopping 149%.

The most common typologies of banking fraud being identity theft, credit card fraud, transaction fraud, data breach etc. Credit card fraud rose 44.7% in the US while identity theft complaints received were nearly 1.4 million.

What does this have to do with you?

Indeed, these sound like just a bunch of facts and figures, until it happens to us! From a customer’s standpoint it’s a terrible experience. Your card details were misused, you’ve wasted time logging a complaint, the person at the other end is more interested in their lunch hour and here you are, helpless.

From a bank’s vantage point too, it’s a pretty tricky situation because on the one hand you’re dealing with a miffed customer and on the other you need to find a way to safeguard your customers, and your own banking reputation.

Is there really an implementable solution?

And yes thanks to the power of AI, smart chatbots can be used to combat this problem. When it comes to preventing and tackling fraud, a dollar invested now is worth twice as much when a fraud hits. Conversational AI chatbots can identify deviations and warn the customer in time.

Here’s how it would work.

Trend Analysis: AI can analyze account transaction details and patterns by being trained on historic data. By doing so, chatbots can identify behavior similar to the factors that point to fraud. Let’s take an example to understand this better. Assume someone has hacked into a user’s account and now has access to the user’s login credentials. They begin conversations with these credentials, but later struggle to clear the two-factor authentication, or have logged in from a different IP etc. Such deviations can be picked up by AI chatbots as suspicious behavior. And here’s what happens next.

Omni-channel Automatic Alerts: A chatbot sends you an “intelligent bot alert” to alert you of suspect transactions. Using your smartphone, you chat with the bot to confirm if the transactions were made by you. If they weren’t, the bot immediately cancels your card, reverses the charges, and issues a new card to you. Brilliant isn’t it? But wait, there’s more! These chatbots are omni-channel and can alert you on a platform you frequent and prefer, such as WhatsApp (or any other). This way, you don’t end up missing the notification buried in your inbox or text messages.

Biometric Authentication: AI-powered chatbots with voice and facial recognition technology add another slick layer of protection. When the user uses the voice feature, the chatbot can compare it to the user’s voiceprint in the previous note. If they do not match, you can notify the user and the bank, all in real-time.

Speedy Resolution: The cherry on the cake would be the fact that chatbots work 24x7 and can handle multiple queries simultaneously, which means that customers don’t have to wait to talk to a chatbot and can have their fraud reported and resolved in record time.

May the force be with these chatbots!

Conclusion

We at Fluid AI have built a robust platform that can support chatbots for fraud prevention and tracking. 63% of financial institutes are already using AI and ML embedded technologies to facilitate fraud detection. Are you one of them? If you’re looking for more information on this, feel free to reach out to us by clicking here.

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