Using Visa’s Intelligent Analytics, Gas Retailers See a Reduction in Fraud

Visa Transaction Advisor has helped reduce lost and stolen fraud
chargeback rates by 51 percent and counterfeit fraud rates by 54 percent

SAN FRANCISCO–(BUSINESS WIRE)–Visa Inc. (NYSE:V), the global leader in payments, today reported on
results of Visa Transaction Advisor (VTA), a service that extends the
power of Visa’s global risk intelligence to fuel merchants, helping to
reduce fraud at the gas pump. More than 35,000 gas stations are actively
using the service in the U.S. On average, Visa Transaction Advisor users
have seen fraud decline by more than half – a 54 percent decline in
counterfeit fraud rates and a 51 percent decline in lost and stolen
fraud chargeback rates.1

“Visa Transaction Advisor gives fuel retailers a tool for applying
Visa’s real-time fraud insights to transactions at the gas pump,” said
Mark Nelsen, senior vice president of Risk Products, Visa Inc. “The
results we’re seeing in the fuel sector attest to the power of
predictive analytics for many of our merchant partners. It’s an
effective model for combatting fraud and one we hope to replicate with
other merchant categories.”

There are several features unique to fuel retailers that make them an
attractive target for today’s criminals. Outdoor pay-at-the-pump
terminals are an ideal place for criminals to test the usability of
stolen or counterfeit cards without the risk of interacting with a store
employee. Because they can resell gasoline with little depreciation in
value, criminal rings will often use fraudulent cards to purchase large
quantities of gas, which they can sell to willing buyers for cash.

As part of the U.S. migration to EMV chip technology, fuel merchants are
working to implement chip readers at fuel pumps which will protect
against counterfeit card fraud. In the interim, while fuel merchants
work on their plans to adopt chip, Visa Transaction Advisor provides a
bridge solution, enabling merchants to identify and block high-risk
transactions before being processed.

How it works

After a cardholder inserts the card at the pump, Visa analyzes multiple
data sets such as past transactions, whether the account has been
involved in a data compromise, and nearly 500 other pieces of data to
create a risk score within milliseconds. This allows merchants to
identify those transactions with a higher risk of fraud and perform
further cardholder authentication before gas is pumped. Visa research
has shown that when a fraudster is asked to go inside and see a store
employee to complete a transaction, as a result of Visa Transaction
Advisor, they will typically drive away instead.

Visa’s solution is easy to implement – it uses existing message formats,
pump software and hardware to ensure minimal impact to merchants and
acquirers. The implementation is typically done at the national brand
level, requiring very little work from local franchise locations. The
service, which analyzes more than 76 million transactions each month,
has been successful among international, national and regional fuel
retailers as well as smaller local businesses.

Visa has partnered with a number of U.S. acquirers to deliver the
service and can also work directly with merchants to implement Visa
Transaction Advisor as part of their fraud management system. Fuel
brands that have implemented Visa Transaction Advisor have provided
great feedback on its benefits:

  • “Visa Transaction Advisor was easy to implement. We were able to set
    up the service quickly, using existing infrastructure, and saw
    immediate results,” said Gabriel Andres Porras, Merchant Acquiring
    Manager at Chevron. “This tool is helping to protect our business from
    fraudsters at more than 8,000 retail locations across the U.S.”
  • “Visa Transaction Advisor provides an extra layer of security at our
    15,000 service stations in the U.S.” said Mike Swillo, US Credit Card
    Operations Manager at Shell. “It seamlessly integrates with our other
    risk management strategies and provides added protection for merchants
    without inconveniencing our customers. We’re able to provide added
    security at our fuel pumps, which protects our customers, station
    operators and the brand.”
  • “What makes Visa Transaction Advisor so effective is that it helps
    block criminals before they can even pick up the pump,” said Rich
    Steckroth, Director of Business Development at Sheetz, a chain with
    more than 500 convenience stores located in Maryland, North Carolina,
    Ohio, Pennsylvania, Virginia, and West Virginia. “This helps us to
    maintain a great customer experience while still managing for fraud.”

About Visa Inc.: Visa Inc. (NYSE: V) is a global payments
technology company that connects consumers, businesses, financial
institutions and governments in more than 200 countries and territories
to fast, secure and reliable electronic payments. We operate one of the
world’s most advanced processing networks — VisaNet — that is capable of
handling more than 65,000 transaction messages a second, with fraud
protection for consumers and assured payment for merchants. Visa is not
a bank and does not issue cards, extend credit or set rates and fees for
consumers. Visa’s innovations, however, enable its financial institution
customers to offer consumers more choices: pay now with debit, pay ahead
of time with prepaid or pay later with credit products. For more
information, visit usa.visa.com/about-visa.html,
visacorporate.tumblr.com
and @VisaNews.

1 Source: VisaNet, data from September 2014-September 2015

Contacts

Visa Inc.
Lea Cademenos, +1 415-805-4271
lcademen@visa.com
or
Fabricio
Migues, +1 415-805-4487
fmigues@visa.com