Visa plans to include more data in its advanced authorization technology to better protect banks' gas station clients.
All Visa issuing banks, merchants and consumers will benefit from the real-time data provided in the improved authorization software, known as VAA, to flag potential fraudulent transactions, Visa announced Oct. 2 at its Global Security Summit in Washington, D.C. Visa says its network will pinpoint suspicious activity at a gas station and then apply the data to all transactions processed at that station to thwart other fraudulent efforts.
When we see account testing [a fraudster seeing if he can complete a transaction] at a particular station, we let the issuer know there is an elevated risk at this station, says Mark Nelsen, head of risk and authentication products for Visa.
Visa updates the VAA annually, identifying pockets of retail that can be singled out as new segments with targeted authorization upgrades, Nelsen says.
Fuel as a category has been a large testing ground for fraud, Nelsen says. We are always looking at ways to improve fraud detection and help that segment.
Visa alerts the card-issuing bank of potential problems, and the issuer would then alert the merchant as to what was causing declined authorizations at the station, Nelsen says.
Visas authorization monitors account velocity at fuel pumps and compares it to the cardholders normal behavior with that account. Such observations can potentially increase the effectiveness of fraud detection at gas stations by as much as 266% for debit transactions and 163% for credit transactions, Visa says.
Visa has added more transaction history data to each account profile, which is a major component of the risk score assigned to a given transaction. Visa provides those risk scores to help issuers complete authorization decisions.
Visa says the risk scores improve fraud detection across all industries by as much as 130% for debit transactions and 175% for credit transactions.
Visas advanced authorization evaluates more than 500 different aspects of a transaction in less than one millisecond, Nelsen says. The improvements affect card-present and card-not-present transactions, he adds.
It was important to provide stronger protection for gas station pumps, partly because the fuel industry has two more years than other retail segments to convert its payment infrastructure to accept EMV chip-based smart card payments, Nelsen says.
In-store terminals at gas stations have other protections in place, and the additional enhancement to VAA provides a new model for unattended fuel-pump devices, Nelsen adds.