Visa is reportedly in advanced discussions to acquire the fraud-prevention company Featurespace, with the deal potentially reaching a value of $925 million, according to a report from Sky News on Saturday, August 24. While some sources suggest the deal could be worth significantly less, the exact figure remains uncertain.
Featurespace, whose clients include major financial institutions like HSBC, NatWest Group, and Worldpay, has experienced growing demand for its fraud detection services amid a rise in financial scams worldwide. The company’s flagship technology, Adaptive Behavioral Analytics, leverages machine learning to detect and prevent fraudulent activities in over 180 countries.
Both Visa and Featurespace have been contacted for comments on the potential acquisition but have yet to respond.
Featurespace’s Innovations in Fraud Detection
The report also highlights Featurespace’s connection to the late tech investor Mike Lynch, who recently passed away in a tragic incident off the coast of Sicily. Featurespace paid tribute to Lynch, recognizing his significant contributions to the company. “It is a high statistical probability that Featurespace wouldn’t be a thriving technology company without Mike,” the company stated, acknowledging his role as an early investor and his decade-long tenure as a Non-Executive Director from 2008 to 2019. Lynch’s support helped drive the development of Featurespace’s innovative AI technology.
Last month, Dave Excell, co-founder of Featurespace, spoke to PYMNTS about the rising prevalence of financial scams, exacerbated by new tools accessible to fraudsters. Excell emphasized that Featurespace’s solutions address multiple types of scams, including job-related scams that have increased by 118% year over year, according to data from the Identity Theft Resource Center. These scams often deceive job seekers by posing as legitimate recruiters or employment agencies.
To help banks and financial institutions combat these growing threats, Featurespace recently introduced a new product called Scam Detect. This tool focuses on data sharing, allowing banks to better utilize existing information by integrating it into a cohesive intelligence framework to track and verify the movement of funds.
As the talks between Visa and Featurespace progress, the potential acquisition underscores Visa’s commitment to enhancing its fraud prevention capabilities amid a rapidly evolving financial landscape.
Insights from Treasury Expert
We thought it would be valuable to get perspectives visa acquiring Featurespace from Treasury expert Baptiste Collot, CEO of Trustpair.
Baptiste Collot, CEO of Trustpair, Comments:
With 96% of US companies targeted by payment fraud at least once in 2023, it’s not surprising that all stakeholders – financial institutions, payment providers, and corporates – are getting more involved in fraud prevention. Banks are traditionally seen as the gatekeepers against fraud but payment providers and corporates also have their role to play, by adopting the right tools and processes.
Having a collaborative approach that leverages the strengths of all involved is critical to safeguard effectively against increasingly sophisticated threats. It’s what Visa is doing with this potential acquisition of Featurespace and what we’ve been doing at Trustpair for years, thanks to innovative partnerships with banking leaders.
This is all very promising: indeed, it’s only by aligning our efforts that we’ll be able to fend off the threat!
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