The partnership has contributed to a 55 percent decrease in card fraud, helping to improve customer experience and business growth for the Sweden-based bank. Swedbank, like many other financial institutions across Europe, had been under pressure to meet strong customer authentication (SCA) compliance mandates.

SCA, a new regulatory mandate under PSD2, intends to protect consumers and businesses from fraud by making it more difficult for fraudsters to make payments from their accounts. Under the new regulations, consumers and businesses must verify their identity with at least two steps of authentication. SCA checks are mandated for every digital payment over EUR 30 but can be exempted if the merchant has demonstrated low levels of fraud, for example.

The bank partnered with ACI to enhance its fraud platform with the help of ACI Fraud Management and has transitioned from a rules-based to a holistic fraud management approach – which now applies insights from machine learning and shared data in addition to rules – to exempt low-risk transactions from the SCA requirements. Utilising ACI’s model generator functionality allows Swedbank to create and maintain their own predictive machine learning models within minutes. The offering was recently enhanced with shared intelligence, empowering the bank to collaborate and build hybrid machine learning models.