In a world where all technologies are constantly evolving, online payment follows the trends. So, the big question is how artificial intelligence impacts online payment in the short term. Online shopping has expanded greatly beyond our computers and our phones with the help of AI on payments, and it will continue to grow as we may see new devices with better capabilities. Consumers are looking for a payment experience that doesn't sacrifice safety, and they expect this technology to be at reach. While still might make us humans feel a bit uncomfortable and puzzled, chatbots are a tool to provide buyers with relevant content and suggestions to automate the back-end.

Despite a massive increase in online activity during the COVID-19 pandemic, fraud on the Visa payment network is at an all time low, the company says. One of the chief reasons for that success is a big investment in advanced analytics and AI. The world changed in March 2020, when many countries went into lockdowns to prevent the spread of the virus that causes COVID-19. As retail shops and other physical locations closed, people's attention turned to the Internet for school, work, and play. Since late 2019, the volume of e-commerce traffic has grown by 50%, according to Visa.

The company that would become PayPal Holdings first entered the electronic payments space in 1999, a year after being founded as Confinity. Confinity merged with Elon Musk's x.com in 2000 and was renamed PayPal the following year. The company went public in 2002 shortly before its acquisition by eBay, through which it became "the site's official payments provider." Today, PayPal processes more than 35,000 transactions every minute. In the last year, PayPal has processed some $1.2 trillion in total payment volume (TPV). On its website, the company claims to have grown to 416 million active consumer and merchant accounts and employs 27,700 employees.

Revenue loss certainly grabs attention from business leaders across industries – but fraud affects all of us. It can take aim at a deeply personal level, such as with identity theft. It also spirals up to the level of massive fraud schemes stemming from organized crime rings. Let's look at five types of fraud to learn how they work and how analytics helps us fight back. Synthetic identity fraud happens when a criminal combines real and fabricated credentials to create a new, implied identity that's not associated with a real person.

Machine Learning aids e-commerce to foil attempts at payment fraud, as they happen. Long before the pandemic led to an avalanche of online shopping, e-commerce had become a way of life for many Americans, especially Millennials and Gen Zers. In fact, 60% of Millennials bought online in 2019, while 24% Gen Zers strongly prefer to purchase online and 13% through mobile. This has led to variety of online shopping choices, including e-shops, online banking, online insurance and other online services. As Hil Davis, Co-founder of the online men's retailer, said, "E-commerce and mobile commerce have dramatically changed the way brands reach customers, making it faster and easier for consumers to make purchases on the fly while avoiding the hassles of going to the store."

Payments solutions provider Vesta today announced that it raised $125 million in capital, bringing its total raised to over $145 million. The company says it will use the financing to grow and accelerate the deployment of its fraud protection and ecommerce payment products. Payment fraud is pervasive -- in 2018, $24.26 billion was lost due to credit card fraud worldwide, reports Shift Processing. That same year, the rate of card fraud increased by nearly 20% as the U.S. took the lead in reported losses. Vesta says its AI-powered decisioning platform helps clients to assess the risk of this fraud and ultimately to prevent fraud from occurring, with connectors that tie into existing software from vendors including Magento, Shopify, WooCommerce, BigCommerce, and SAP Commerce Cloud.

Artificial Intelligence (AI) is becoming ubiquitous in recent years and its uses are seen in every industry from health, to travel, to banking, to hospitality and finance. According to the IHS Markit's "Artificial Intelligence in Banking" report, the global AI market is expected to reach $300 billion by 2030. AI is becoming important for all businesses that rely heavily on data. This is because this technology has the ability to teach itself and make it better through its practice. This is done through deep learning which includes the acquisition of new knowledge, the development of motor and cognitive skills through experience or practice, the assembling of knowledge into general, effective presentations and the discovery of new facts and theories through observation and experimentation.

For financial institutions like banks, security is one of the topmost priorities as banks are under constant threat of frauds and hacks. Through AI, decreasing rates of false positives, preventing fraud attempts and lessening manual reviews of potential payment frauds is achieved. According to a recent survey, 'AI Innovation Playbook' published by PYMNTS in collaboration with Brighterion, 80% of fraud specialists who employ AI-based platforms believe the AI technology helps reduce payment frauds and prevent fraud attempts. This shows the scope of AI for the mitigation of payment frauds. Payment frauds are reduced through AI's ability to interpret trend-based insights through supervised machine learning, which is then joined with completely new knowledge achieved through unsupervised machine learning.

Fraud attacks are getting to be progressively sophisticated– as innovation advances, fraudsters have raised their game on payment fraud and money laundering. With access to faster and less expensive computing, fraudsters have moved their objectives to more beneficial weaker points in the financial services chain. The adoption of machine learning has been accelerated with increasing processing power, accessibility of big data and headways in statistical modeling. Fraud management has been excruciating for banking and business industry. The quantity of transactions has expanded because of plenty of payment channels, credit/debit cards, cell phones, kiosks.

AI is proving to be very effective in battling fraud based on results achieved by financial institutions as reported by senior executives in a recent survey, AI Innovation Playbook published by PYMNTS in collaboration with Brighterion. The study is based on interviews with 200 financial executives from commercial banks, community banks, and credit unions across the United States. For additional details on the methodology, please see page 25 of the study. One of the more noteworthy findings is that financial institutions with over $100B in assets are the most likely to have adopted AI, as the study has found 72.7% of firms in this asset category are currently using AI for payment fraud detection. Taken together, the findings from the survey reflect how AI thwarts payments fraud and deserves to be a high priority in any digital business today.