AI and Biometrics Give Sellers Confidence to Do Business Globally

When businesses go global, they are often exposed to new risks such as exposure to cybercriminals seeking to exploit their lack of familiarity with the idiosyncrasies of regional payments processes. Key tasks like as ensuring that payment sources and payment recipients are legitimate can be difficult to accomplish for small to mid-sized businesses (SMBs) and entrepreneurs with limited resources. Few, if any, SMBs have access to a full-fledged compliance and risk management department with the technical and regulatory expertise required to mitigate sophisticated fraud attacks, but newer technologies can help.

“Cross-Border Commerce Futures: How AI And Biometrics Are Transforming Global Risk Management,” a PYMNTS and Payoneer collaboration, explores how artificial intelligence (AI) and biometrics are making cross-border payments more secure and efficient for emergent global businesses.

Why new markets can mean new problems

According to the report, SMBs and entrepreneurs face various challenges when expanding internationally. Identifying suspicious transactions and vulnerabilities to fraud — a critical task for businesses and payment services providers supporting global companies and entrepreneurs — requires more than a basic understanding of how fraud works. It demands up-to-the-minute awareness of the latest tactics used by bad actors and the best ways to combat the tools they use.

Coupled with this challenge is the issue of technical sophistication and the clear advantage that many bad actors have over new entrants to international markets, especially concerning the intricacies of global payment options. The report notes that as new technologies emerge in retail and financial services, bad actors leverage these same innovations to evolve their methods of committing fraud and other crimes. Cross-border operations add additional challenges.

Growth is a blessing and a burden for many SMBs

SMBs that manage to grow safely may find that growth itself becomes a unique challenge. As the report notes, global risk management becomes even more difficult at scale, and as business success and transaction volume increase, technical vulnerabilities to complex fraud attacks also grow exponentially.

Managing know your business (KYB) requirements can also be a global challenge. FinTechs and financial institutions (FIs) may find themselves caught in the middle of warring interests: Preserving user experience is a priority, but the complexity of cross-border regulations can make seamless payments difficult to consistently deliver as requirements vary from region to region.

A modern security strategy based on the latest anti-fraud and risk management technologies — AI and biometrics — can help SMBs and entrepreneurs transform their ability to identify and mitigate risk. Other findings include:

• AI and biometrics allow FIs to level up their data security, fraud detection and risk mitigation strategies.

• AI enhances risk analysis by leveraging lightning-fast processing power to identify fraud or financial crime vulnerabilities.

• AI and biometrics power advanced global transaction monitoring for signs of suspicious activity.

• The right payments solution can automate anti-fraud and risk mitigation strategies.

SMBs and entrepreneurs do not have to rely on their own tech stacks to defend themselves from global fraud attacks. To learn more about the role of AI and biometrics in risk mitigation, download the report.