B2B Payments

Mastercard Talks Securing Innovation, And Innovating Security

In financial services today, security and innovation can work with each other, and against each other.

FinServ cybersecurity is, of course, a prime target for innovation. But customers’ constant demand for cutting-edge products and services is adding to the load of already heavy security burdens. At the same time, providers must ensure a positive, consistent customer experience.

Mastercard Chief Security Solutions Officer Ajay Bhalla recently explored the relationship between financial services innovation and security, telling PYMNTS how these two dynamics can complement each other while guiding the FinServ space in its journey to a better service offering.

Bank customers’ needs and demands of financial service providers are growing more sophisticated and complex. What is driving this trend?

According to the Digital Evolution Index, more countries in more parts of the world have robust digital ecosystems, driving demand for trusted technology. We are on track toward a world with more than 30 billion connected devices – an irreversible trend that is dramatically changing the digital economy and delivering fulfillment of the possibility that consumers have been waiting for: The ability to increase transparency, interact with brands and move faster, with less friction.

For the banks and merchants serving them, the challenge is matching the great strides in connectivity with consistency of experience and security. The pace of innovation focused on consumer experience is showing no signs of slowing down. Meanwhile, criminals are increasingly using technology designed for good in a nefarious manner. Key to success in 2018 will be the adoption of a security by design approach in innovation that marries the establishment and deployment of standards with leading edge technology.

With so many options available to financial service providers to implement and offer new technologies, how can they provide a consistent end-user experience while ensuring that products and services are cutting-edge?

We’re off to a great start in 2018, securing innovation through globally adopted standards like 3-D Secure 2.0 from EMVCo and “PIN on Glass” from the PCI Council. These create consistency and pave the way for banks and merchants to plug in and leverage the power of billions of connected devices to deliver greater consumer experiences, while also addressing threats from cyberattacks and hacks. Put simply: Industry standards enable trust and make it feasible to scale the use of technology.

Passwords remain commonplace, despite the evolution of security technology. How can financial service providers address customer demand for authentication processes that are more secure, efficient and convenient than passwords?

For consumers – some of which have up to 90 online accounts and find passwords difficult to remember – we have room to improve. For the past five years, we’ve been very focused on getting rid of passwords. Passwords are “something you know,” not “something you are.” Remembering passwords is frustrating, and only getting harder as digital activities proliferate. Identifying people by who they are makes life safer and simpler for the individual.

That is the driving force behind our efforts to develop Identity Check, which uses biometric identifiers, such as fingerprint, iris, facial or voice, to verify consumers’ identities using a mobile device during online shopping and banking activities. This speeds up checkout time, improves security and reduces cart abandonment rates. Our biometric payment card, which has already been trialed with consumers, is another example of reshaping their experience. And by retaining focus on consumer-centric solutions, we are not restricted to the single biometric of any device.

These technologies are on the edge of innovation, and research we conducted in partnership with the University of Oxford found that 92 percent of banking professionals want to adopt biometric technology. 2018 is the year we can scale the adoption of biometrics in payments.

Artificial intelligence is another technology that’s driving advancement of financial service cybersecurity. How will FinServ players deploy AI tools in the coming year?

Artificial intelligence and machine learning are increasingly providing the means to interpret and action the complexity and scale of data to generate useful intelligence and an individualized outcome for every interaction, despite the scale/volume. For us, artificial intelligence is already embedded in our network and how we help protect our partners. The acquisition of Brighterion progressed our use of AI, enabling our network to adapt faster and deliver even greater accuracy in decisioning and managing risk.

AI is increasingly being deployed to help banks and merchants look at these new data points to give people a better experience. This will continue to grow in 2018, but the shift will be focused on leveraging the Internet of Things through behavioral analytics. Our acquisition of NuData Security has improved visibility into what is happening at the device level. It allows us to assess patterns of behavior of the user, detect botnet automation and determine the reputation of the device – critical insight for merchants in optimizing the consumer experience and for issuers in determining whether to approve payment. This capability can be applied across any device in the future.

What barriers will the financial services space have to overcome as it integrates and experiments with new technologies to enhance both the customer experience and security?

The internet holds the promise of a bright future ahead, but between here and there is a chasm – and it’s called insecurity. The investment in technology, such as physical biometrics, advanced behavioral analytics, risk-based authentication and artificial intelligence, will grow. It has to, in order to secure digital payments, mobile banking applications and other channels across established, challenger and FinTech sectors. Securing innovation and innovating security will help get us across the chasm and deliver greater trust in the right technologies in 2018.



Banks, corporates and even regulators now recognize the imperative to modernize — not just digitize —the infrastructures and workflows that move money and data between businesses domestically and cross-border.

Together with Visa, PYMNTS invites you to a month-long series of livestreamed programs on these issues as they reshape B2B payments. Masters of modernization share insights and answer questions during a mix of intimate fireside chats and vibrant virtual roundtables.