Teradata and FICO, the analytics software firm, plan to bring to market integrated analytic solutions for real-time payments fraud, insurance claims, and supply chain optimisation.
What is the market offering of the joint solution?
Bringing data, analytics and insights into one environment streamlines the development of solutions for use cases across industries, speeding time-to-delivery and making them available for joint clients sooner. The resulting solutions are part of a new global relationship between the two companies, and are expected to deliver reduced costs, improved profits, increased risk mitigation and greater customer satisfaction for Teradata/FICO customers.
The two companies have identified three initial offerings:
Fraud detection for real-time payments
While FICO fraud solutions are the global leader in card payments fraud, protecting over 2.6 billion payment cards, this sophisticated protection isn’t available for other kinds of payment products. To address this, FICO and Teradata have designed a fraud solution for real-time payments to help mitigate increasing scams and payments fraud in retail banking accounts.
The solution will bring together FICO’s FICO® Falcon® Fraud Manager, with its consortium data and neural network models, and Teradata’s capabilities in enterprise-scale AI/predictive and prescriptive analytics. This is expected to provide a holistic view of a banking customer’s transactional and payments activity, and when combined with FICO decision management, provide best-in-class fraud prevention for P2P, B2C, ACH and other payment transactions.
Improving outcomes for complex medical claims
Predicting and managing healthcare expenditures is a top strategic priority for property & casualty, major medical, and public (government) insurance programs. Despite industry progress in specific, targeted areas – such as opioid addiction or kidney failure – an approach for containing total cost across any condition still eludes industry leaders.
FICO and Teradata have designed a decision automation solution to accelerate the inclusion of patient insights into the operations of claims adjusters, case managers, and special investigations units. The result of using artificial intelligence (AI) in this solution to quickly segment and then identify pathways to care (based on procedures and diagnoses) can lower the financial burden while producing superior medical outcomes for the patient.
Enhancing supply chain efficiency and increasing resilience
Once an almost invisible societal benefit, global supply chains are now under scrutiny as they experience strain under the unrelenting pressure to deliver. From food to medicine to transportation and tech, fragile supply chains must navigate this volatile environment.
FICO’s advanced mathematical optimisation coupled with Teradata’s multidimensional scaling has the potential to enable firms to build robust capabilities to model, optimise and simulate different scenarios that affect their supply chains, and then deploy the most efficient options.
At the heart of this capability is the optimisation modelling platform based on FICO® Xpress Insight, which allows researchers, data scientists, analysts, and managers to collaborate on supply chain solutions that facilitate timely decision making. This can lead to improved efficiency across plan, source, make, deliver, and return, increasing a firm’s resilience with rapid identification and mitigation of risks, and improved long-term customer satisfaction.
What does the partnership mean for the industry?
Commenting on the solution, Alexandre Graff, Senior Vice President of Partnerships for FICO, said, “Behind these solutions and others we are developing is incredible IP in decision management technology, predictive analytics, mathematical optimisation and other areas.”
“Teradata and FICO both have outstanding teams and technologies for operational analytics. Together we can make breakthroughs that help businesses worldwide prosper,” Graff said.
“AI is changing everything, and business will need to adjust to both the threats and the opportunities,” commented Lisa Stewart, SVP WW Partners and Alliances at Teradata.
“From fighting fraud to managing global supply chains, AI-powered analytics and advanced decision management are the new requirements for keeping up as well as creating advantage. These are the core competencies of Teradata and FICO, and our partnership will make it easier for our joint customers to innovate in this new AI-driven reality,” Stewart said.
FICO was recently named Best Technology Provider for Data Analytics at the 2022 Credit Awards, and a Leader in The Forrester Wave™: Digital Decisioning Platforms, Q4 2020.
In addition, Gartner has named Teradata a Leader in the Magic Quadrant for Cloud Database Management Systems and ranked Teradata number 1 in all four use cases in the Critical Capabilities for Cloud Database Management Systems for Analytical Use Cases. The four use cases are: Data Warehouse, Logical Data Warehouse, Data Lake, and Streaming Analytics.
The joint solutions from Teradata and FICO are targeted for availability in Q3 2023, globally.
What is the wider industry context for this partnership?
Real-time payments are a rapidly growing trend in the financial industry. These payments allow funds to be transferred between accounts almost instantaneously, which can offer a number of benefits for both businesses and consumers. However, real-time payments also create new opportunities for fraudsters.
One type of fraud that is becoming increasingly common in the context of real-time payments is account takeover fraud. In this type of fraud, criminals gain access to a victim’s online banking account and then use that account to make unauthorized payments. This type of fraud can be difficult to detect, as the payments may appear to be legitimate.
Another type of fraud that is becoming more common in the context of real-time payments is synthetic identity fraud. In this type of fraud, criminals create fake identities that they use to open bank accounts and then use those accounts to make fraudulent payments. This type of fraud can be difficult to detect, as the criminals often use real information to create the fake identities.
Insurance claims are another area where real-time payments can be vulnerable to fraud. In this type of fraud, criminals may submit fraudulent claims for insurance payments. These claims may be for losses that never occurred, or they may be for losses that have been exaggerated.
Supply chain optimization is another area where real-time payments can be beneficial. By using real-time payments, businesses can improve their supply chain efficiency by reducing the time it takes to make payments to suppliers. This can lead to lower costs and improved customer service.
However, real-time payments also create new challenges for supply chain management. One challenge is that it can be difficult to track payments in real time. This can make it difficult to ensure that payments are being made on time and in the correct amounts.
Another challenge is that real-time payments can make it easier for fraudsters to steal money from supply chains. This is because fraudsters can use real-time payments to make fraudulent payments to suppliers, which can be difficult to detect.
Despite the challenges, real-time payments offer a number of potential benefits for businesses and consumers. By using real-time payments, businesses can improve their efficiency and reduce costs. Consumers can also benefit from real-time payments, as they can receive payments more quickly.
To mitigate the risks of fraud, businesses should implement strong security measures to protect their systems and data. They should also work with their banks and other financial institutions to develop fraud prevention strategies. Consumers should also be aware of the risks of fraud and take steps to protect themselves.
By taking these steps, businesses and consumers can help to ensure that real-time payments are used safely and securely.
In addition to the above, here are some additional thoughts on the future of real-time payments:
- Real-time payments are likely to become increasingly common in the coming years. This is due to the growing demand for faster and more convenient payments.
- As real-time payments become more common, it is important to be aware of the risks of fraud. Businesses and consumers should take steps to protect themselves from fraud.
- Real-time payments offer a number of potential benefits for businesses and consumers. These benefits include improved efficiency, reduced costs, and increased convenience.
- By taking advantage of the benefits of real-time payments, businesses and consumers can improve their operations and save money.
Gerald Ainomugisha is a business news reporter and freelance B2B marketer with over 10 years of experience in writing high-converting copy and content for businesses of all kinds, especially SaaS providers in the niches of HR, IT, fintech, eCommerce and web3.
