Credit card fraud has become a costly and incessant threat in today’s digital economy. Global payment card fraud losses reached a staggering $37.9 billion in 2024, rising about 5% from the previous year. While consumers are generally protected from these losses by law and card network policies, financial institutions and merchants bear the brunt of the damage. Every dollar of fraud costs businesses multiple dollars in associated fees and operational overhead – for example, in 2024 each dollar lost to fraud cost merchants an estimated $4.13 in total losses. These figures underscore the high stakes: businesses need to stop fraudulent transactions before they incur losses and damage customer trust.

 

Payment transactions occur in seconds or less, and merchants expect approvals to be near-instantaneous. Any solution must operate in real-time, catching fraud as it happens without creating friction. This post explores how our propriety fraud detection software protects businesses and overcomes technical challenges of fraud detection in real-time.

 

Why Real-time Detection and Transaction Rejection at the Source?

 

Modern payment systems process thousands of transactions per second, and decisions on whether to approve or decline must be made in milliseconds, not minutes. In fact, at peak times a large bank might process up to 10,000 payments per second, each requiring an on-the-spot risk evaluation. Behind the scenes, real-time fraud detection poses significant technical challenges. The first is the need for decision speed. Decisions often must be rendered in under a few hundred milliseconds – sometimes as low as ~50ms for credit card network decisions. And it has to happen in real-time before the transaction succeeds.

 

Nerodata’s automated fraud detection models and rules instantly analyze each transaction’s data and decide “fraud or no fraud?” within a split second.

 

Further real-time correct detection offers several critical benefits. First, it prevents financial loss by stopping fraudulent transactions mid-stream, before funds are irrevocably transferred. That means fewer chargebacks and less revenue lost to fraud. Second, it preserves customer experience – legitimate purchases are approved with minimal latency, so honest customers aren’t subjected to delays or unnecessary declines. Speedy, accurate approvals maintain trust and satisfaction.

 

If you want to start leveraging the full power of Nero Fraud Gate and real-time fraud detection with transaction rejection, simply contact us as [email protected] for us to guide you through your compliance needs and processes.