Fintech
Swift introduces AI pilots to fight cross-border payment fraud
Of Fintech News Singapore
June 3, 2024
Swift, the global financial messaging cooperative, announced two AI-powered experiments in collaboration with member banks to combat cross-border payment fraud that could potentially save the industry billions in fraud-related costs.
The first pilot aims to improve Swift’s existing payment monitoring service, which detects indicators of fraud, by using an artificial intelligence model to create a more accurate picture of potential fraud activity.
This enhancement will use historical models across the Swift network, refined with real data from Payment Controls customers.
In a separate experiment, Swift partnered with 10 major financial institutions, including BNY Mellon, Deutsche Bank, DNB, HSBC, Intesa Sanpaolo and Standard Bank, to test AI technology for analyzing anonymously shared data.
This initiative could transform sensitive data sharing and improve fraud detection globally.
Additionally, testing could lead to broader use of information sharing in fraud detection, building on its success in assessing cybersecurity threats.
The group will use secure data collaboration and federated learning technologies, enabling financial institutions to exchange relevant information while maintaining strong privacy controls.
Swift’s AI anomaly detection model will analyze this enriched dataset to identify potential fraud patterns.
Fraud cost the financial sector $485 billion in 2023. Artificial intelligence has significant potential to reduce these costs and help achieve the G20 goal of faster cross-border payments.
Tom Zschach
Tom Zschach, Director of Innovation at FastShe said,
“AI has great potential to significantly reduce fraud in the financial sector. This is an incredibly exciting prospect, but one that will require strong collaboration.
Swift has a unique ability to bring financial organizations together to leverage the benefits of AI in the interest of the industry, and we are excited by the potential of both of these pilots to help further strengthen the cross-border payments ecosystem.”
Swift has created an AI governance framework in collaboration with its community to ensure that accuracy, explainability, fairness, auditability, security and privacy are integral to every aspect of its AI applications.
These pilots are rooted in the responsible use of AI and are aligned with emerging global standards, such as ISO 42001, the NIST AI Risk Management Framework and the EU AI Act.
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