New Smarter Stand-in Processing uses AI to
help reduce the number of declined transactions for consumers when
financial institutions experience an outage or disruption
Visa Inc. (NYSE: V) today announced Visa Smarter Stand-in
Processing (Smarter STIP), a new capability that uses real-time
artificial intelligence (AI) to help financial institutions manage
transaction authorizations when service disruptions occur. Using
deep learning to analyze past transactions, Smarter STIP generates
informed decisions to approve or decline transactions on behalf of
issuers in the event that their systems go offline. Visa pioneered
the use of AI and neural networks to prevent fraud—Smarter STIP
builds on that track record, and is the first in a suite of new
AI-powered innovations coming to VisaNet, Visa’s global processing
network.
“Consumers expect instant and uninterrupted access to their
funds—failure to meet that expectation can be costly,” says Jack
Forestell, executive vice president and chief product officer,
Visa. “Stand-in processing has always been a vital assurance to our
clients that when the unexpected occurs, we’ve got their back. By
adding AI, that capability becomes smarter, stronger, and more
dynamic.”
Addressing the challenge of downtime
Whether it’s scheduled maintenance or an unexpected outage,
service downtime is disruptive for financial institutions and their
customers. When stand-in processing is not in place, the potential
impacts can be profound: lost revenue due to failed transactions,
poor cardholder experience resulting in call volume spikes to
customer service centers, damage to reputation, and even scrutiny
from regulators.
Visa’s new Smarter STIP service builds on Visa’s existing STIP
capability by using deep learning to analyze past transactions down
to the cardholder level. Thus the transaction decision that Smarter
STIP provides is based on unique insights derived from the
cardholder’s past purchasing behavior, rather than solely on static
rules applied across an entire card portfolio. With this added
intelligence, Visa is able to provide a transaction decision on the
issuer’s behalf that more closely mirrors the issuer’s own decision
making process—with the potential to decrease transaction declines
for cardholders by up to 50% in some cases.1
Harnessing AI for the Payments Ecosystem
Visa Smarter STIP is one of several new real-time deep learning
capabilities designed to solve long-standing challenges and pain
points for buyers, sellers, and financial institutions.
These enhanced services are made possible by the investments
Visa has made to optimize its core infrastructure. This includes a
scalable, high-performing, GPU-based platform designed to support
the rapid deployment of deep learning capabilities.
“AI is one of the most transformative technologies of our time,
giving us the power to build data-driven products that deliver new
levels of insight and personalization. With one of the largest and
richest data sets in the world, Visa is extremely well positioned
to unlock the full potential of AI for our clients and cardholders,
and at massive scale,” says Rajat Taneja, president of technology
at Visa. “We’ve made significant investments in our infrastructure,
making it possible to harness this data more deeply across all
facets of VisaNet. Our data, combined with low-latency architecture
and our unique modeling capabilities, make our technology platform
among the most powerful for AI.”
Global adoption already underway
Smarter STIP will be available in October 2020 and has generated
interest from a range of financial institutions around the
world.
“At UBS, we believe in building a better future for our
customers by harnessing the power of innovation and collaboration—a
continuous process that relies on innovative thinking and
transformative technologies and capabilities, developed both
in-house and by our partners,” says Stefan Uebelhart, Head of UBS
Card Center. “We are very pleased to launch Visa’s Smarter STIP
service, as this is an example where the power of collaboration,
transformative technologies and innovation come together to provide
an improved experience for our cardholders. In our quest to build a
better future for our customers, we see Visa as a valued partner
and intend to work together in the innovation space.”
“As a leader in interest-free shopping platforms in Australia
and New Zealand, Latitude Financial is constantly exploring new
technology and innovation so we can deliver the best possible
service to our customers,” said Latitude’s Chief Commercial
Officer, Paul Varro. “Visa’s Smarter STIP service helps us
substantially improve transaction approval rates. This is a great
outcome, cleverly bringing together AI with our historical
authorisation learnings, new datasets, and Visa’s experience in
transaction processing to provide a rich customer experience, all
the time.”
About Smarter STIP
Visa created the Smarter STIP capability to address a key pain
point for issuers and issuer processors: the suboptimal experience
for cardholders during service disruptions. Visa’s novel approach
to stand-in processing, recognized through a US Patent in 2019,
improves on the existing STIP capability through real-time
evaluation of cardholder-level features. The model relies on:
- Multiple recurrent neural network layers with millions of
parameters.
- Billions of historical records to train the model, resulting in
an average 95% accuracy in emulating an issuer’s likely decision in
Visa’s sample tests2.
- Continuous learning from real time transaction and outage data,
allowing the service to adapt and improve as an Issuers’ behavior
changes over time.
Visa Smarter STIP does not require any technical change for
clients to participate. Issuers connected to Visa DPS will be
enabled for Smarter STIP when the service launches globally in
October 2020.
About Visa Inc.
Visa Inc. (NYSE: V) is the world’s leader in digital payments.
Our mission is to connect the world through the most innovative,
reliable and secure payment network - enabling individuals,
businesses and economies to thrive. Our advanced global processing
network, VisaNet, provides secure and reliable payments around the
world, and is capable of handling more than 65,000 transaction
messages a second. The company’s relentless focus on innovation is
a catalyst for the rapid growth of digital commerce on any device
for everyone, everywhere. As the world moves from analog to
digital, Visa is applying our brand, products, people, network and
scale to reshape the future of commerce. For more information,
visit About Visa, visa.com/blog and
@VisaNews.
1 Based on Visa internal analysis comparing existing and Smarter
STIP approval rates of all transactions in Q1 CY2020 for a single
US Issuer. 2 This number was measured by Visa’s internal simulation
of the Smarter STIP model offline on transactions for all Visa BINs
globally in Q4 2019. On average, the Smarter STIP model made the
same approve/decline decision as the issuers 95% of the time, for
transactions across all regions.
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version on businesswire.com: https://www.businesswire.com/news/home/20200826005289/en/
Visa Inc. Lea Cademenos 415-319-2961
lcademen@visa.com
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