Mastercard acquires Ethoca for e-commerce fraud protection
Mastercard will acquire Toronto-based digital commerce fraud protection provider Ethoca.
Financial details were not disclosed
Financial details were not disclosed. The deal follows on from yesterday’s report (11 March), when Mastercard dropped its Earthport bid and instead acquired cross-border account-to-account money transfer network Transfast.
In this latest acquisition, Ajay Bhalla, president of cyber and intelligence solutions for Mastercard, says: “Ethoca is a strong addition to our multilayered cyber strategy, helping customers take immediate action against fraud and eliminate chargebacks before they can occur. In turn, consumers are provided with a better checkout experience every time they shop at a participating site.”
Ethoca’s network has more than 5,000 merchants and 4,000 financial institutions around the world.
When a fraudulent transaction is identified, near real-time information is sent to the merchant so they can confirm the transaction, stop delivery or reverse the transaction to avoid the chargeback process.
Mastercard intends to further scale these capabilities and combine Ethoca with its current security activities, data insights and artificial intelligence (AI) solutions.
According to Juniper Research, retailers are expected to lose $130 billion in online fraud over the next five years. In addition, research firm Aite Group estimates that false declines – when card issuers decline transactions from good customers due to a perceived fraud risk – cost the industry $331 billion in 2018 in the US alone.
The transaction is anticipated to close in the second quarter of 2019.
Ethoca says eight of the top ten North American e-commerce brands, 14 of the top 20 North American card issuers and six of the top ten UK card issuers use its solutions and network.
