Monday, February 22, 2016

Mastercharge To Reduce Unnecessary Credit Card Declines

MasterCard is introducing behavioral and contextual analytics tools to help card issuers navigate fraud risks. Called Authorization IQ and Assurance IQ, the tools are part of a new product line called, of course, MasterCard IQ.
Mastercharge recently announced a mobile alert system for Mastercard holders to notify them of out-of-locale or large spending.  They are following this with announcements related to reducing credit card declines which they are calling Mastecharge IQ.  
Authorization IQ offers issuers insights on the behavioral patterns related to user accounts, analyzing them to determine the risk level of a current transaction. Assurance IQ, meanwhile, extracts information from a merchant concerning a transaction’s circumstances and analyzes it to produce a risk score with respect to potential fraud.
The problem being addressed is false declines.  These false declines create several problems.  One is that it results in lost business. The value of false declines per year is estimated now as $118 billion. By any measure, hat is a huge amount of lost business.  
But it gets worse since once a person finds that their card is unreliable, they start to lose confidence in their card and to use other cards instead.  So this is a very competitive area for people to improve on. I saw a number of sites today that rehashed the Mastercard announcement about reducing credit cards declines.  What I didn't see is any analysis of whether this brings Mastercard up to par with Visa and Amex declines or whether it puts them ahead.

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