Mastercard to buy identity verification firm Ekata for $850m

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astercard has stepped up its digital identity efforts with the acquisition of identity verification firm Ekata in a deal valued at $850m.

The acquired company works with a range of global merchants, financial institutions, travel companies, marketplaces and digital currency platforms.

It leverages insights to provide unique scores, data attributes and risk indicators to help enable businesses make more informed decisions by identifying good consumers and bad actors in real-time during online account opening, payments and other digital interactions.

Mastercard said it views digital identity to be a foundational part of its multi-layered approach to security.

This comes almost a year after fellow card issuer American Express launched Accertify Digital Identity, designed to help organisations address rising fraud. If a bank or financial organisation fails to protect its customers not only will the institution face potential regulation charges, but its reputation will also be damaged. Since the pandemic began, financial fraud has been on the rise, with many fraudsters developing more sophisticated ways to compromise vulnerable people. Therefore, it is a critical time for financial organisations to invest more in security and protecting their customers.

Amex’s Accertify Digital analyses data using machine learning, advanced behavioural analytics and device intelligence technology to calculate a trust score and associated reason codes for account activity in near real-time to help prevent fraud loss.

Card giant Visa also has a its own ID Intelligence platform, which, like the others, enables financial institutions to adopt authentication technologies, such as face, fingerprint or voice recognition.

This investment in data-driven security is very promising. Banks must find an effective way to alter their security measures in line with changing regulations – and AI is the best way to do this.