Danske Bank joins list of companies using AI to detect fraud

Maria Nikolova

Danske Bank has teamed up with Teradata’s Think Big Analytics consulting arm to deploy an AI-driven platform for fraud detection.

Nordic financial services provider Danske Bank A/S (CPH:DANSKE) has partnered with Think Big Analytics, the consulting arm of Teradata Corporation (NYSE:TDC), as the bank joins a growing list of companies using artificial intelligence to identify and tackle fraud. The companies have collaborated to develop and launch an AI-driven platform for fraud detection.

The engine uses machine leaning to analyze tens of thousands of latent features, scoring millions of online banking transactions in real-time to provide actionable insight regarding true, and false, fraudulent activity. One of the main advantages that such a system has is that it reduces the number of false-positives and the costs of investigating them. To secure transparency and trust, the engine includes an interpretation layer on top of the machine learning models, providing explanations and interpretation of blocking activity.

Mads Ingwar, Client Services Director at Think Big Analytics commented:

“For online transactions, credit cards and mobile payments, banks need a real-time solution – the state of the art AI-driven fraud platform we have developed in collaboration with Danske Bank scores incoming transactions in less than 300 milliseconds. It means that when customers are standing in the supermarket and buying groceries, the system can score the transaction in real-time and provide immediately actionable insight. This type of solution is one we’ll begin to see throughout organizations in the financial services industry,”

Other banks are increasingly using AI solutions to detect fraud too. One example is Oversea-Chinese Banking Corp. Limited (SGX:O39), aka OCBC. In July this year, the bank announced a partnership with fintech companies BlackSwan Technologies and Silent Eight to develop and use a new AI solution aimed at detecting suspected illegal financing, by searching for information on individual profiles, and mapping suspicious transactions to see how they may be linked.

And in February this year, Japan Exchange Regulation (JPX-R) and Tokyo Stock Exchange, Inc. (TSE) said they were working on applying AI to market surveillance operations by using technologies developed by NEC Corp (TYO:6701) and Hitachi, Ltd. (TYO:6501). Tests show that the AI solutions are highly accurate in detecting the possibility of unfair trading.

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