A financial services company speeds up fraud detection

Protecting customers and innovating new product offerings with an IBM business rules platform

Published on 18-Dec-2012

"We have reduced our rules deployment process from days to hours. It’s a tremendous improvement in speed and it reduces the resources needed for implementation." - Group head of global network products, financial services company

Customer:
A financial services company

Industry:
Banking, Financial Markets

Solution:
Business Process Management (BPM)

Overview

A leader in the global payments industry, this financial services company serves approximately 22,000 financial institutions in more than 210 countries and territories. The company strives to make commerce faster, more convenient and more secure, providing innovative services that enable its customers to use electronic forms of payment. It offers a wide range of credit, debit and prepaid offerings.

Business need:
To help its customers mitigate risk more quickly and effectively, a financial services company needed to accelerate deploying business rules that identified fraudulent transactions.

Solution:
IBM delivered a rules management solution, providing a flexible framework that leverages reusable decision logic to rapidly implement rules and create new product offerings.

Benefits:
The IBM solution has enabled the company to reduce deployment time for new rules from days to hours, empower its customers with new capabilities and position itself for competitive differentiation.

Case Study

A leader in the global payments industry, this financial services company serves approximately 22,000 financial institutions in more than 210 countries and territories. The company strives to make commerce faster, more convenient and more secure, providing innovative services that enable its customers to use electronic forms of payment. It offers a wide range of credit, debit and prepaid offerings.

Seeking accelerated deployment for critical business rules

Powered by the fastest payment processing network in the world, the company processes approximately 43,000 transactions each minute and a total of more than 23 billion transactions each year. The rapid flow of transactions presents a daunting challenge for the company in terms of risk mitigation. A group head of global network products for the company explains, “We have millions of transactions flowing out over our network. We know that, statistically, less than 0.1 percent of these transactions will potentially end up being fraud. So the question is, how do we find these transactions among the millions traversing the network?”

To help protect its banking customers, the company analyzes data from fraud attacks and creates parameters, or business rules, to identify and flag other potentially fraudulent transactions. However, the company’s process for rolling out these rules was far too lengthy. “Every time we wanted to change or create rules, we had to perform a full development cycle, getting the requirements ready, testing them into regression—all the way through until the rules were deployed,” says the group head of global network products. “It could be days, or sometimes weeks, depending on the complexity. We had to find a way to do this a lot more quickly. You can’t tell a bank, ‘There’s a fraud attack and we’ll help you in a week from now.’”

Locating a uniquely qualified technology partner

The IT organization within the company began discussing the need for a technology platform that would enable the fast, efficient implementation of business rules. “Initially, we were looking for something that would address our customers’ fraud mitigation needs,” says the group head. “Then we looked at this at a high level and realized that rules are an integral part of how we do business. We started looking for a solution that we could use anywhere within our company and deploy new products.”

The company launched an exhaustive vendor selection process, creating a request for proposal (RFP), interviewing RFP respondents repeatedly, and eventually creating a short list of three solution providers. After visiting each of the finalists onsite and interviewing references, the company chose IBM. “We needed to have very strict control mechanisms in the solution,” says the group head. “That played a big role in our final decision. The management of business processes, privileges and workflows were key areas driving our choice of the platform from IBM.”

Implementing a flexible framework to slash deployment time

IBM delivered a flexible rules management framework, implementing IBM® Operational Decision Management software to serve as the rules engine for the solution and the IBM WebSphere® Message Broker enterprise service bus (ESB) to connect with data sources across the organization. To link the operational decision management platform to the company’s network and the ESB, IBM deployed the IBM WebSphere MQ universal messaging backbone. The system processes approximately 3,000 transactions per second, evaluating 130 to 180 data points in each transaction.

By allowing the company to leverage repeatable processes, the new framework significantly accelerates the timeline for deploying new business rules. The group head says, “We have reduced our rules deployment process from days to hours. It’s a tremendous improvement in speed and it reduces the resources needed for implementation.”

Cutting deployment time enables the company to respond much more quickly to its customers’ risk mitigation needs. Since rolling out the new solution, the company has been able to stop several fraud attacks within an hour after receiving the initial report.

The solution also allows the organization to extend rules authoring capabilities to its banking customers while controlling the rights and privileges assigned to them. “Once we create specific processes throughout the system to drive checks and balances, we can deliver an easy-to-understand, packaged service to our end customers,” says the group head. “We can lay out to them exactly how this works, what their sign-on privileges provide them—it’s a repeatable process we can rely on. We don’t have to build tests every time we do this because the process has been proven and works well.”

Launching new product offerings with an innovative platform

With the new solution successfully up and running, the company is currently considering additional applications. For example, if a governmental organization needs to disperse aid and prohibit unauthorized use of the funds, the company can rapidly deploy a set of rules restricting card use to a specific area, for specific purposes, within a specific period of time.

The group head says, “The IBM Business Rules platform will definitely help us differentiate. We have the flexibility to create new products and use repeatable processes to accelerate go-to-market. It’s something we’re very excited about.”

For more information

To learn more about IBM Operational Decision Management software, please contact your IBM marketing representative or IBM Business Partner, or visit the following website: ibm.com/ibmodm

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Products and services used

IBM products and services that were used in this case study.

Software:
WebSphere MQ, WebSphere Message Broker, IBM Operational Decision Manager

Legal Information

© Copyright IBM Corporation 2012 IBM Corporation Software Group Route 100 Somers, NY 10589 Produced in the United States of America December 2012 IBM, the IBM logo, ibm.com, and WebSphere are trademarks of International Business Machines Corp., registered in many jurisdictions worldwide. Other product and service names might be trademarks of IBM or other companies. A current list of IBM trademarks is available on the web at “Copyright and trademark information” at ibm.com/legal/copytrade.shtml This document is current as of the initial date of publication and may be changed by IBM at any time. Not all offerings are available in every country in which IBM operates. The performance data and client examples cited are presented for illustrative purposes only. Actual performance results may vary depending on specific configurations and operating conditions. THE INFORMATION IN THIS DOCUMENT IS PROVIDED “AS IS” WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OR CONDITION OF NON-INFRINGEMENT. IBM products are warranted according to the terms and conditions of the agreements under which they are provided.