BBVA and GMV evolve on bank fraud detection technology with Artificial Intelligence

One of the most critical activities for any bank nowadays is fraud detection and prevention. According to the European Central Bank, “bank fraud is declining due to technological advances that make transfers more secure”. Spain is in fact one of the European countries where credit card fraud has fallen most sharply, 45% down on the 2006 figure.

The Department of Innovation for IT Risk, Fraud & Security of BBVA and the Spanish multinational company GMV, mindful of this huge problem, are working jointly on a groundbreaking R&D project to improve fraud detection by application of artificial intelligence technology, specifically, by using the solutions called “Artificial Immune Systems”.

This project is part of a wider-ranging collaboration arrangement between BBVA, Spanish industry and academia, hoping to harness the innovative and technological capacity of the Spanish firms involved together with BBVA’s wealth of knowledge in this matter, all with the overall objective of achieving top-level, state-of-the-art results within worldwide fraud detection.

The solution designed by BBVA and GMV for fraud detection in credit/debit card transactions consists of an adaptation of artificial intelligence algorithms based on immunological systems. This groundbreaking idea pushes back the boundaries of existing techniques, adapting to and learning from new fraud patterns as soon as they occur. The very nature of the algorithms also favors the input of certain contextual information about why an event is considered to be fraudulent. Lastly these algorithms, in their own right or in combination with other technology, can cut down the rate of false positives, i.e., reduce the number of card transactions that are flagged as fraudulent when they are no such thing.