Issue link: https://maltatoday.uberflip.com/i/1299109
6 INSIGHT AI-enabled facial recognition The pandemic gave precedence to AI-driven facial recognition solutions. A group of restaurants and retailers in California combined the need for stemming the spread of Covid-19, and the task of handling payments secure- ly. The effort resulted in a face-pow- ered payment confirmation system, or PopID. According to Marius Galdikas, the pay-by-face idea bears great potential as it requires a lot less engagement from the customer's perspective, which adds to its appeal. "Such AI-powered payments de- crease the required effort from the customer to the bare minimum," Galdikas said. "Eliminating the extra steps in the process—taking out the card, entering the required PIN—is likely to improve perceived shopping experience, as customers can focus on a grab-and-go approach and save time. This leaves very little room for hassle, which, in fact, may lead to increased shopping cart values too." Interruption-free transactions While conducting a digital payment transaction, users want one thing above all else - a smooth, glitch-free experience, as unexpected lags are too much of a disruption for the mod- ern-day customer. VISA has already attempted to bridge any possible outages by introducing a Smarter Stand-in Processing (Smarter STIP), which leverages deep learning to analyse past transactions before generating decisions to approve or de- cline transactions on behalf of issuers. The prototype is set to be released in October, and the smart stand-in solution may push other players in the payment industry to also look for additional measures that could help limit the number of declined transac- tions. "For merchants, a smooth payment process may be the single most im- portant aspect in terms of retaining customers with the ever-decreasing attention span," Galdikas said. "Bypassing issues related to system glitches could help avoid costly fail- ures for both PSPs and merchants. In addition, combining such solutions with AI enables to adopt a more dy- namic approach and deal with similar situations in a timely manner, without any noticeable mishaps for the cus- tomers." Fraud-resilient settlements The past few months reemphasized the importance of anti-fraud meas- ures, as having more users switching to online shopping instead of brick- and-mortar businesses resulted in skyrocketing levels of scams. The finance sector has already ramped up the cybersecurity spent to keep the fraudsters at bay. AI can assist with recognizing pat- terns and exceptions, minimizing fraud for complex, high-volume trans- actions. Human error is one of the more pronounced weaknesses, so using task-specific AI to recognise dubious transactions will have a significant impact on the overall fraud resistance of digital payment systems. In addition, fraud prevention not only protects against the loss of funds but also saves businesses additional costs for legal settlements, which can add up to above $3 for each dollar lost to scammers. "The circumstances surrounding Covid-19 and the growth of online fraud adds up to the stressors that urge both merchants and PSPs to deepen their search for novel security tools even more," Galdikas said. "Thus AI-driven solutions are highly likely to become a must-have among tools for ensuring transparency and reducing fraud." Without a doubt, the real impact of AI usage in the digital payments mar- ket will reveal itself over time. That said, it seems a wider imple- mentation of AI-driven integrations is inevitable, as it carries the promise of next-level actionable solutions that would sustain the growing demand for digital payments. The growing role of artificial intelligence in the digital payments market 15.10.2020 AI-driven technology is gaining momentum in the digital payments market, both in backend operations and customer-facing payment systems. Marius Galdikas, CEO at ConnectPay, shares a few insights about AI-based solutions currently being rolled out in the market and their significance for the industry