Acquirers Turn Fraud Data Into New Revenue

Acquirers are packaging payment-risk data into products for merchants and other businesses that need to detect suspicious activity and limit losses. The data is collected while acquirers screen transactions for fraud.

Acquirers process card payments and can see transaction details linked to unusual purchasing patterns, repeated chargebacks and compromised payment credentials. They use these signals to improve fraud screening and provide related services to businesses.

Services can include risk scoring, transaction monitoring, chargeback management and tools that flag suspected fraud before a payment is approved. Acquirers may charge for these services through subscriptions, per-transaction fees or contracts that combine fraud prevention with payment processing.

Merchants can use the tools to block transactions, request additional customer verification or send questionable payments for manual review. The services can reduce losses from fraudulent transactions and the administrative work involved in disputed payments.

The commercial use of fraud intelligence is governed by rules on payment data, customer privacy and information sharing between companies. Acquirers must distinguish between data used to protect a payment and data sold as a separate service. Depending on the market and data type, information may need to be anonymised, aggregated or shared only with authorised customers.

Acquirers operating across countries or merchant categories can compare fraud signals from a wider range of transactions. The use of those signals remains subject to local regulations and contractual limits.

The payments industry is developing services based on information generated during payment processing. Fraud prevention is one area where acquirers can sell data-based services alongside transaction processing.