PULSE, a Discover Financial Services Firm, Extends Debit Fraud Detection Agreement with FICO

PULSE, a Discover Financial Services (NYSE: DFS) company and operator of the PULSE debit network, has agreed to an extension of its partnership with global analytics software provider FICO (NYSE: FICO).

PULSE and FICO collaborate “to deliver fraud-detection technology that reduces losses and risk exposure for financial institutions, merchants and consumers worldwide.” This extension supports PULSE in “continuing to enhance its DebitProtect® suite of advanced fraud-mitigation solutions, powered by the state-of-the-art FICO® Falcon® Fraud Manager.”

PULSE’s network-level deployment of Falcon Fraud Manager “employs learnings from its 9,000 participating financial institutions.” Institutions using DebitProtect and DebitProtect Authorization Blocking “for, respectively, fraud alerts and automated authorization blocking benefit from that dynamic data pool.”

PULSE has deployed FICO’s latest fraud model, “which segments card-not-present transactions separately from card-present transactions.” This enhanced scoring “improves the network’s ability to identify fraudulent transactions in e-commerce and other card-not-present channels.” This capability is key as consumers continue “to adopt digital-payment methods and fraudsters increasingly focus their efforts there.”

Jim Lerdal, executive vice president of Operations with PULSE, said:

“Our enhanced fraud-detection and blocking capabilities have become more important than ever with the Federal Reserve’s Regulation II clarification expected to shift more card-not-present transaction volume to unaffiliated debit networks such as PULSE. Extending our close partnership with FICO enables us to continue enhancing our ability to prevent and respond to the latest trends in debit fraud.”

Adam Davies, vice president of Fraud at FICO, said:

“PULSE and FICO have outstanding, innovative teams and are constantly adapting to provide tools financial institutions can use to mitigate evolving security risks. Our Falcon Fraud Manager model benefits from the fraud learnings fed into it from PULSE’s large network of debit card issuers. We look forward to continuing to collaborate with PULSE to protect all debit stakeholders.”

The forthcoming 2023 PULSE Debit Issuer Study, “conducted for PULSE by West Monroe, confirmed that debit issuers are heavily focused on fraud-prevention and mitigation efforts, with nearly 90% of survey respondents reporting increased impact of and attention to fraud in 2022.”

While 76% of respondents said they enhanced their fraud models last year “to reduce fraud losses and false positives, other mitigation efforts included sharing and promoting educational materials with customers, enabling self-service capabilities, modifying rules and investing in authentication tools.”


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