How Worldpay & Capital One Aim to Reduce Payments Fraud
Worldpay, the global payments technology provider that processes over 50 billion transactions annually, has entered a data sharing agreement with digital banking and credit card issuer Capital One to reduce payment fraud and false declines.
The partnership connects Worldpay's FraudSight platform – a machine learning-based fraud detection system – directly to Capital One's fraud risk decisioning engine, enabling real-time data exchange for transactions made using Capital One cards.
“Innovation and ingenuity define our work with Worldpay, which is bringing a new level of security to every single payment made with a Capital One card for merchants using FraudSight,” says Jon Borman, Head of Fraud Strategy at Capital One.
Risk reduction metrics
In June 2024, Capital One announced it was partnering with Adyen and Stripe to combat fraud by introducing a free, open-source solution called Direct Data Share (DDS): an initiative designed to enhance real-time authorisation decisions, thereby reducing fraud losses and false declines for merchants.
Internal data from Capital One indicates the Direct Data Share (DDS) programme could reduce false positive declines – legitimate transactions incorrectly flagged as fraudulent – by 40%. False declines currently affect approximately 6% of e-commerce transactions, with up to 10% of these being incorrect rejections, representing significant revenue loss for merchants.
The initiative arrives as global online payment fraud losses reached £38bn last year, with fraudsters increasingly targeting cross-border transactions and mobile commerce platforms. The collaboration aims to address these challenges while improving legitimate transaction approval rates across multiple payment channels.
The partnership represents a shift in the payments industry towards collaborative fraud prevention. Traditional fraud detection systems often operate in isolation, leading to higher rates of false positives as each entity makes decisions based on limited data sets.
“At Worldpay, we're passionate about improving payments. Our data sharing collaboration with Capital One enhances the effectiveness of Worldpay's innovative FraudSight solution and drives better outcomes for our merchants using the solution,” says Cindy Turner, Chief Product Officer at Worldpay.
Technical implementation
The integration operates through a direct connection between Worldpay’s FraudSight platform and Capital One’s fraud decisioning systems. This enables automated risk assessment using expanded data points from both organisations, including transaction velocity, merchant category codes, and historical payment patterns.
US-based merchants using Worldpay's payment services and FraudSight solution will receive these benefits automatically when processing Capital One card payments. The system operates across multiple payment channels, including e-commerce, mobile payments and point-of-sale transactions.
- £38bn lost to online payment fraud globally in 2023
- 6% of e-commerce transactions currently rejected due to fraud suspicion
- Up to 10% of declined transactions are false positives
Capital One is providing the Direct Data Share tool to Worldpay at no additional cost, marking a departure from traditional fee-based data sharing arrangements in the payments industry.
Merchant impact
The initiative particularly benefits merchants in high-risk sectors such as digital goods, travel, and luxury retail, where false declines can significantly impact revenue. The enhanced data sharing enables more accurate fraud detection without increasing transaction processing times.
The partnership currently focuses on US-based merchants but establishes a framework for international expansion. Worldpay's global presence, spanning 146 countries and 135 currencies, positions the initiative for potential deployment across multiple markets.
“Our Direct Data Share tool is being offered to Worldpay as a free, secure and compliant product that allows their merchants using FraudSight to participate. By enhancing our data and information sharing, we're not just cutting fraud, we're setting a new standard for seamless and secure transactions,” says Jon Borman.
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