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Real-Time Fraud Detection Model

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tusharamalalia
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23 views13 pages

Real-Time Fraud Detection Model

Uploaded by

tusharamalalia
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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REAL-TIME

FRAUD
DETECTION
MODEL
About the Model
- We propose leveraging advanced AI for real-time fraud
detection in digital payments. Our solution includes
immediate alerts and educational messages during
transactions to help users spot and prevent fraud.
- We’ll enhance security with a QR code authentication system
that analyzes transaction data, user behavior, and QR code
details instantly. User feedback will further refine our
detection capabilities.
Team Buzzinga!

 Pranav BJ - AIT22BEDS063 AIML, AIT

 Tushar A - PES2UG22CS632 CSE, PES University

 Neeraj K Shastry - AIT22BECS166 CSE, AIT

 P Dilip Sri Satya Chaitanya - AIT22BECS168 CSE, AIT

 Mohanapriya - AIT22BECS210 CSE, AIT

 Hema TR - AIT22BECS184 CSE, AIT


Problem statement
 In the rapidly evolving landscape of digital payments and
financial transactions, users are increasingly exposed to the
risk of fraudulent activities during money transfers. The lack of
a real-time, user-friendly, and proactive solution to identify
potential fraud in payment transactions poses a significant
challenge.
 Existing fraud detection mechanisms do not operate in real-
time, leaving users vulnerable to the instantaneous nature of
fraudulent activities during transactions.There is a demand for
a proactive system that prevents fraudulent transactions in
real-time.
Solution
 Implementing advanced machine learning and artificial intelligence
algorithms to provide real-time alerts and educational messages to
users during transactions, guiding them on how to identify and
avoid potential fraud.
 Implementing a robust QR code authentication mechanism to verify
the legitimacy of scanned QR codes by analyzing transaction
patterns, user behavior, and QR code information in real-time.
 Developing the model that can identify anomalies, deviations from
normal behavior, and potential indicators of fraud by taking reports
from the users into consideration.
Innovation/Novelty
 The proposed solution introduces a real-time, user-friendly, and
proactive fraud detection system for digital payments and financial
transactions.
 Unlike existing mechanisms, this system leverages advanced machine
learning algorithms and artificial intelligence to analyze transaction
patterns and user behaviors instantaneously. By integrating with
payment gateways and banking systems, it can identify and block
suspicious activities as they occur.
 The system is designed to be intuitive, requiring minimal user input
while providing maximum security. The novelty lies in its
combination of speed, accuracy, and ease of use, making it a
pioneering solution in the digital payments industry.
Details of use of Technology

 Database: Utilize SQL for storing transaction data and user information.

 ML Algorithms: Employ advanced ML techniques for real-time fraud


detection and anomaly detection.

 LAMA 3 Model: Enhance natural language processing to analyze user


reports and provide personalized responses.

 QR Code Authentication: Implement real-time analysis of QR code


scans to verify authenticity
Competitor Details
Currently, several players in the market offer fraud detection solutions,
but they primarily focus on post-transaction analysis and lack real-time
capabilities.
Notable competitors include:
• PayPal Fraud Protection: While PayPal offers comprehensive fraud
detection tools, its system often identifies fraud post-transaction,
leading to potential delays in rectifying fraudulent activities.
• Stripe Radar: Stripe’s fraud detection tool uses machine learning to
identify fraud, but it primarily operates on the server-side, which may
not provide real-time user interaction and feedback.
• Sift Science: This company offers advanced fraud detection
solutions using AI, but their focus is more on e-commerce
platforms rather than general financial transactions.
• FICO Falcon Fraud Manager: Known for its robust fraud
detection capabilities in the banking sector, FICO’s solution
is extensive but can be complex to implement and manage,
lacking the user-friendly aspect of the proposed solution.
Socio-Economic Impact
The introduction of a real-time fraud detection system in digital
payments has significant socio-economic implications:
• Increased Trust in Digital Payments: By providing a secure and reliable
transaction environment, more users will adopt digital payment
methods, leading to greater financial inclusion, especially in
underbanked regions.
• Employment Opportunities: The development, implementation, and
maintenance of this technology will create jobs in the tech and
financial sectors.
• Reduction in Financial Losses: Immediate identification and
prevention of fraudulent activities will save users and
financial institutions substantial amounts of money that
would otherwise be lost to fraud.
• Enhanced User Experience: A user-friendly system that offers
peace of mind during transactions will improve the overall
customer experience, encouraging the use of digital financial
services.
Market Potential

The introduction of this real-time fraud detection system is poised to


disrupt the digital payments market:
 Competitive Advantage: Financial institutions and payment service
providers that adopt this technology will have a significant
competitive edge, attracting more customers who prioritize
security.
 Market Expansion: Enhanced security measures will facilitate the
expansion of digital payments into new markets and
demographics previously hesitant due to fraud concerns.
 Cost Savings: By preventing fraud in real-time, financial
institutions can reduce the costs associated with fraud
investigation, customer reimbursements, and loss
recovery.
 Regulatory Compliance: The system can help institutions
comply with stringent regulatory requirements for fraud
prevention and data security, avoiding potential fines and
reputational damage.

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