Currently most of us have to inform our bank by phone when we’re travelling to avoid purchases in other countries appearing as red flags for fraud and being declined. That could soon change as Visa looks to track smartphones with a service called Mobile Location Confirmation in order to help their security systems become smarter and reduce declined purchases by as much as 30%.
While infrequent, unnecessary transaction declines can mean lost sales for retailers, additional customer service costs for financial institutions and, ultimately, frustration for the cardholder if unable to make a purchase when traveling… The service uses mobile geo-location data in real time as an additional input into Visa’s predictive fraud analytics. Finsphere Corporation, a leader in the use of mobile data and geo-spatial analysis, provides Visa an analysis of the account holder’s device location data, which is then matched with the transaction location in less than a millisecond, right at the point of sale.
The service will be an optional one that your bank will have to implement and ask you to opt in to through their own mobile app.
So it doesn’t necessarily mean you can avoid making the call entirely just yet, but Visa said “when a cardholder’s mobile device is in the same location as the payment transaction, the issuing financial institution can more confidently approve the transaction.” That will certainly help cut down on the many legitimate purchase that get flagged for fraud each year and give consumers a bit more piece at mind if they are willing to opt-in to being tracked.
Visa also noted that it “estimates, issuing financial institutions spend hundreds of millions of dollars annually to manage customer service calls related to pre-travel requests and to research declined transactions.”
It’s unclear how the service might work alongside Apple Pay for cards that are loaded into Apple’s new iOS-based payments service.
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