Visa and Mastercard invest billions in cybersecurity AI to combat bank fraud
Following Mastercard's acquisition of Recorded Future, Visa now wants to buy Featurespace. These companies use artificial intelligence to detect bank fraud.
(Image: Hadrian/Shutterstock.com)
Both Visa and Mastercard are increasingly relying on artificial intelligence (AI) to detect potential financial fraud attempts. This month, both credit card companies announced plans to acquire software companies that specialize in this area. Mastercard is prepared to spend 2.65 billion US dollars on Recorded Future, and this week Visa announced its intention to buy Featurespace.
Visa has now signed a binding agreement. The British software company Featurespace develops AI-supported payment recognition processes to prevent or at least reduce financial fraud and similar crimes in the banking sector. With corresponding AI solutions, fraud attempts can be detected in real time and thus protect the financial system, Featurespace writes.
Featurespace for Visa
Visa has already invested billions of dollars in technology over the last five years to reduce financial fraud and increase network security, but neither Visa nor Featurespace have named a price for the takeover. Sky UK had previously reported that the Featurespace takeover would cost more than 938 million dollars, but insiders say it could end up being less.
Featurespace was founded in 2008 and already works for well-known banks such as HSBC and financial companies such as Worldpay. In addition to fraud attempts, the software company's AI technologies can also be used against cybercrime and ransomware attacks, which are also increasingly using generative AI. AI-generated malware has just been spotted in the wild. Statista estimates the cost of cybercrime at 9.2 trillion dollars in 2024 alone.
Mastercard with Recorded Future
Mastercard also cites this statistic when announcing its acquisition of Recorded Future for 2.65 billion dollars. This US cybersecurity company was founded in 2009 and is one of the largest of its kind with around 1,000 employees. According to Mastercard, it has over 1900 customers in 75 countries, including government agencies in 45 states.
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Like Featurespace, Recorded Future also offers real-time detection of potential threats using AI processes, whereby billions of pieces of data are analyzed using AI. Mastercard plans to integrate this technology into its own cybersecurity services against identity theft and financial fraud. Both Mastercard and Visa will in turn offer this to their customers, such as banks.
According to the plans of Visa and Mastercard, the takeovers of Featurespace and Recorded Future are to be completed over the course of next year (2025) following a review by the supervisory authorities.
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