According to the Global Economic Crime and Fraud Survey (2019-2020) conducted by PwC, the losses due to global fraud amounted to US $42 billion. Of the surveyed number, 47% of financial institutions have experienced fraud.
Common fraudulent activities encountered in the lending business is ID theft. A person pasting his/her photo onto someone’s Aadhar card, etc. The increasing sophistication of the frauds during the pandemic has been the biggest challenge for digital lending institutions.
Artificial Intelligence (AI) and Machine Learning (ML)
StashFin has been at the forefront of using technology and is also amongst the first few financial institutes in India to use AI and ML to detect frauds. Their fraud detection solutions not only detect frauds but also investigates and provide remedies while analyzing a customer’s exposure to fraud. Analytic techniques like network link analysis, predictive modeling, and text mining are used to identify the patterns of fraud. They monitor wire transfers, corporate transactions, online banking, mobile banking, and ATMs.
Parikshit Chitalkar, Co-Found StashFin states “A lot of our capital investment will primarily be in Artificial Intelligence (AI) this year, especially on developing solutions using computer vision technologies and building neural networks for advanced fraud detection. We have been fine-tuning our Machine Learning (ML) models for credit risk assessment over the last year and will now deploy these on a larger scale to serve a broader segment of customers. We will also be expanding our mobile footprint to provide a larger bouquet of services to our customers.” Delinquencies get drastically reduced when fraud detection systems effectively weed out ID theft.
StashFin uses image matching, computer vision models, and facial detection to detect cybercriminals. Customers have to undergo several ML filters to assess risks and they are rated in the registry as per the data provided by them.
As frauds are increasing by the day, unless foolproof systems are put in place for fraud detection, the lending institution will remain vulnerable. The new AI and ML technology that StashFin uses makes it easier for them to preempt fraudulent activities and also provide secure platforms.