Less financial crime. More business.

Ivan Stefanov, CEO & Co-Founder at NOTO, reveals more about the Enterprise Fraud Management (EFM) platform that unifies fraud & AML.

For readers new to NOTO: what problem did you set out to solve, and how is your approach to fraud prevention and financial crime prevention measurably different?

Where are the biggest risk shifts in payments right now - instant/A2A, Open Banking, APP scams, mules, synthetic identities - and what are payment firms missing?

Risk is shifting to earlier customer journey phases, driven by instant payments that force fraudsters to act sooner (e.g., social engineering, beneficiary hijacking). Authorised Push Payment (APP) scams highlight psychological, not malware-based, threats. Conventional fraud rules are easily bypassed by automated scripts, mule networks, and rapid fund dispersal. Synthetic identity threats emerge months after initial, compliant behaviour. Many enterprises fail to implement journey-wide decision-making, and the isolation of fraud and compliance teams creates inefficiencies and costs.

What are the practical business cases and benefits of converging Fraud and AML with one platform, and what measurable uplifts have your clients seen?

Quantifiable benefits: A unified FRAML framework significantly reduces vendor costs by consolidating fraud and AML solutions. It optimises third-party data use, improving risk assessment accuracy and lowering acquisition costs. This framework also enhances communication and collaboration between fraud and compliance teams, leading to quicker responses to threats and mitigating financial and reputational damage.

Indirect, yet substantial benefits: Consolidating legacy systems into a single FRAML platform reduces technical debt, freeing up resources for innovation. It minimises maintenance overhead, simplifies integrations, and decreases the number of external vendors, improving administrative efficiency.

Data-related benefits (achieved through effective EFM platform implementation): An Enterprise Fraud Management (EFM) platform centralises data, ensuring consistent record-keeping for analysis, audits, and compliance. It generates accurate reports for better decision-making and adherence to governance standards. The EFM platform also provides tools for managing client cases, improving SLA adherence, customer satisfaction, and regulatory standing.

 

 

How do you handle fragmented data pipelines at scale and what’s NOTO’s approach to data orchestration?

Financial institutions currently manage a complex array of fraud and AML compliance architectures, developed over time, often without a cohesive strategy or long-term planning. This has led to numerous standalone solutions that lack proper communication and are operated by disparate teams.

The NOTO platform is engineered to integrate with any external system, facilitating the comprehensive retrieval of necessary data within its full context. Consequently, this data can be leveraged in any fraud or AML rules and machine learning models, enabling the generation and dissemination of decisions to multiple endpoints. All metadata is meticulously stored and made accessible for reporting and analysis.

The fundamental concept is straightforward: The NOTO platform functions as a centralised decision-making layer, capable of incorporating any data input and empowering financial crime prevention subject matter experts to apply their expertise without constraint.

This approach yields enhanced detection accuracy, reduces third-party data expenditures, and ensures the complete utilisation of point-centric solutions.

When do customers choose SaaS versus on-prem (e.g., data residency, latency)?

Choosing between on-premise and Software-as-a-Service (SaaS) solutions is a complex decision with significant implications for an organisation's operations, finances, and long-term strategy. This choice requires a thorough evaluation of several critical factors:

• Data residency: On-premise solutions offer full control over data location, crucial for compliance with data protection laws (e.g., GDPR, CCPA). SaaS requires vetting provider data centre locations for regulatory adherence.
• Network latency: On-premise solutions provide lower latency due to local data hosting, benefiting real-time applications. SaaS depends on internet connectivity, with latency influenced by user-server distance.
• Organisational type and size: Large enterprises with IT staff and capital may prefer on-premise for control and customisation. Smaller businesses often benefit from SaaS's reduced operational burden and lower initial costs.
• Growth projections: On-premise systems demand planning for hardware upgrades and IT resources for scaling. SaaS offers agile scalability, allowing easy subscription and resource adjustments without significant capital expenditure.
• Application data regulations: Specific industries (e.g., healthcare, finance) have strict requirements for data handling and security. Both solutions must comply with these regulations.
• Technological maturity of the organisation: Organisations with mature IT departments can manage on-premise solutions. Those with limited IT resources may find SaaS providers' managed services more advantageous.
• Cost:

On-premise: Offers predictable annual license fees but involves significant upfront capital expenditures for hardware, software, implementation, maintenance, and IT personnel. While the annual license is fixed, the total cost of ownership (TCO) is substantial, offering full control and customisation.

SaaS: Operates on a subscription model, reducing client operational involvement and shifting capital to operational expenditure. It accelerates deployment, but organisations must evaluate recurring fees, potential vendor lock-in, and data egress/integration costs.

Other crucial considerations include:

• Future migration requirements: Anticipating the ease and cost of migrating data and systems between environments or providers.
• Disaster recovery (DR): On-premise requires organisations to implement their own DR plans. SaaS typically includes built-in DR, but organisations must understand provider policies, RTO, and RPO.
• Security: On-premise offers ultimate control over security infrastructure but places the full burden on the organisation. SaaS providers invest heavily in security, but organisations must conduct due diligence on certifications, incident response, and data encryption.

In conclusion, the decision between on-premise and SaaS is strategic, requiring a holistic evaluation of an organisation's needs, resources, risk tolerance, and long-term objectives to ensure alignment with strategic goals and support sustained growth.

Proof point: share a before-and-after client story- what changed for them after moving to NOTO?

Success metrics and Key Performance Indicators (KPIs) exhibit substantial variability across different clients, even within the same business vertical. This diversity underscores the need for a flexible and adaptable solution. NOTO addresses this by providing clients with an Enterprise Fraud Management (EFM) platform designed to evolve alongside their business.

NOTO's EFM platform empowers financial crime prevention teams to untangle the complexities of managing multiple disparate solutions and tools. By consolidating these functions, the platform enables teams to respond more rapidly and effectively to emerging threats. This consolidation also allows them to leverage their collective knowledge and experience to its fullest potential, fostering a more cohesive and efficient fraud prevention strategy.

The tangible benefits observed by NOTO's clients often include a significant reduction in fraud rates, fewer false positives in their detection systems, a decrease in the need for manual review processes, and a notable reduction in overall vendor costs. These outcomes highlight the platform's ability to deliver measurable improvements in operational efficiency and financial security.

Build vs. buy - and what’s next: where should firms build in-house versus buy a specialist platform today, and what on your roadmap should The Paypers’ readers watch?

Developing in-house solutions can be a tempting, yet often misguided, endeavour for financial institutions, banks, payment service providers, and fintech companies. This approach frequently results in projects that exceed budgets and fall behind schedule, ultimately burdening compliance and fraud teams. The significant financial investment and internal political considerations often prolong the resolution of these issues.

In-house development extends beyond merely allocating a large engineering team and a CTO seeking roadmap substance. It necessitates not only the expertise of fraud and compliance subject matter experts but also a recognition that such projects are continuous undertakings, not short-term sprints.

Organisations should strategically focus their engineering and product development efforts on their core business functions, rather than on ancillary projects that, despite appearing relevant, are significantly more complex than initially perceived.

About author

Ivan Stefanov is the CEO and Co-founder of NOTO, with extensive experience in fraud prevention across financial services and the crypto industry. He previously held senior risk and fraud leadership roles at Groupon, Paysafe Group, and Crypto.com.