Jack Henry Adds AI-Based Fraud Detection to Digital Payments Platform

Jack Henry has launched a real-time, artificial intelligence (AI)-based fraud mitigation feature.

The new Payrailz Fraud Monitor, which joins the FinTech company’s Payrailz Digital Payments Platform, supports multiple payment types and detects fraud when payment transactions are initiated, Jack Henry said in a Tuesday (June 20) press release.

“We’re excited to offer Fraud Monitor to our clients and empower them with a sophisticated, AI-driven feature that scores 100% of P2P [person-to-person], A2A [account-to-account] and bill payments in real time,” Jack Henry President of Payment Solutions Tede Forman said in the release. “The ability to leverage transaction attributes, user profiles and atypical behavior patterns uniquely balances the ability to immediately detect and prevent fraudulent transactions with a frictionless payments experience.”

Jack Henry’s Payrailz Fraud Monitor is highly customizable, according to the press release. For example, the feature generates an actionable score based on multiple fraud attributes and indicators and allows financial institutions to configure score ranges and thresholds based on their own risk tolerance.

“Fraud Monitor delivers a wide range of benefits for our credit union,” Adam Jones, vice president of digital experience at Georgia’s Own Credit Union, said in the release. “In addition to the critical benefit of helping us stop fraud in real time, Fraud Monitor helps with workflow efficiencies by drastically reducing the number of suspicious transactions that need our manual review and automatically stopping fraudulent transactions.”

PYMNTS research has found that about 40% of consumers have suffered from stolen or compromised personal information in the past year, and 46% of banks and other financial organizations have experienced fraud in the last two years.

In response to the evolving threat of digital fraud, financial institutions are leveraging cutting-edge technology to protect their customers and themselves, according to “Stopping Bank Fraud With Cybersecurity Solutions,” the May/June edition of the “Digital-First Banking Tracker®,” a PYMNTS and NCR collaboration.

Businesses are seeing a spike in attempts at fraudulent transactions.

For example, Apple reported in May that it prevented a record level of fraud — totaling more than $2 billion — in app store transactions last year.

According to the Federal Trade Commission (FTC), the amount of money lost to fraud by consumers grew to $8.8 billion in 2022 —more than 30% higher than that recorded in 2021.