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India's Banks Get AI to Fight Digital Fraud
30 Jun
Summary
- AI model pilots to track stolen money in real-time.
- Goal is to intercept fraud before funds vanish.
- Federated learning architecture protects data privacy.
The National Payments Corporation of India (NPCI) has launched a pilot for an artificial intelligence model designed to combat digital fraud. This innovative AI technology can detect and track stolen money in real-time as it moves through various bank accounts.
The system, built on a federated learning architecture, allows nearly a dozen participating banks to run the AI model locally. Each bank generates a risk score for transactions, which is then transmitted to NPCI for aggregation. This process enables NPCI to identify suspicious patterns and networks rapidly.
If a transaction is flagged as unusual or moving abnormally fast through multiple accounts, NPCI can trigger alerts or even freeze the funds before they are fully dispersed. This approach significantly compresses the detection window for fraud from hours or days to mere seconds, addressing a critical challenge in securing digital payments.
