Form3, the cloud-native account-to-account platform, today launches a new, innovative authorised push payment fraud (APP fraud) prevention solution, powered by Feedzai, the market leader in anti-fraud and financial crime software.
The new product is the first solution, built using fully supervised machine learning, to leverage collaborative intelligence to understand the behaviour of both the payment sender and recipient, to determine the risk of the payment being made in real-time.
Form3’s new APP Fraud Solution works by combining its account-to-account payment processing with Feedzai's fraud and financial crime analytics. This produces a model that is trained to identify risk in both the individual sending the money and the person receiving the money. Understanding who is receiving the money is key to preventing fraud, as APP fraud involves impersonation that manipulates the victim into sending the money.
This new solution closes the gaps in intelligence that the fraudsters utilise to be able to use faster payments to target UK consumers and businesses. The solution’s model is then able to detect 95% of fraud at market-standard false positive rates.
Mike Walters, Form3’s CEO, said: “The best way to tackle the rise of APP fraud is the use of collaborative intelligence and cutting edge technologies that allow the real-time identification of scams within the payment message. By bringing together Form3's payment processing expertise, and Feedzai's fraud and financial crime solutions, we can tackle APP fraud so that UK banks can make faster payments safer. Feedzai is the solution provider of choice for two of the top four financial institutions in the UK, so we are partnering with a market leader to combat APP fraud.”
With APP fraud losses accounting for nearly £500m per annum, the solution is timely, as it has been developed on the back of new regulation from the Payment Systems Regulator. This sees victims of APP fraud being refunded by their bank from October 2024, with reimbursement now being the responsibility of both the sending and the receiving institutions.
Pedro Barata, CPO at Feedzai, adds: “There is increasing regulation in this space, and rightly so – we’ve got to do everything in our power to protect the end consumer from APP fraud. With reimbursement becoming mandatory from October this year, it’s also in the interests of all banks to collectively ensure they prevent fraud and save huge payouts. By combining the expertise of Feedzai and Form3, we can drastically reduce the level of vulnerability in the payment process and give our customers the real-time intelligence that they need to stop fraudsters in their tracks.”
The partnership underscores Form3’s commitment to ‘doing well by doing good’, employing cutting-edge technology to tackle the pervasive issue of fraud, which has profoundly impacted countless individuals worldwide.
The service will go live in April, with a full rollout in the UK market expected in the summer of 2024 - ahead of the implementation of the new rules in October 2024.