Risk Management: An Intelligent Operations Framework

A Merchant payment vendor was facing a high volume of low dollar risk events that was getting overlooked due to lack of resources and due diligence capabilities. Data organization was not streamlined and data quality management was something on the backburner for the organization. An imbalanced data reporting and review process was capturing 10% of potential Risk events on a daily basis.

With a strong growth in merchant portfolio a revisit of the Risk operations required building an assessment of the key breakdown points of the risk operations. Identifying the skills and maturity of the team and the planning a framework that will grow with the strategic vision of the company was required.

The Risk team wanted to focus on value-generating tasks that support revenue protection and minimizing losses through early detection of high-risk merchant activity or persisting fraudulent behaviors. The overarching goal is to move the risk management team from complex descriptive analysis to a more mature state of data-driven operations.

A customized phased plan to achieve these through a framework that considered:
• Scalable platform designed for growth
• Smarter analytics-driven decisions and insights generation
• Becoming competitive by adopting NextGen technology and data-framework.
• Building redundancy through capture of expertise and domain knowledge through well documented functionalities.

A detailed assessment and recommendation of a phased plan, grounded in recouping revenue savings ( from undiagnosed risk events - like chargeback fraud, new merchant onboarding, accumulating risk exposures, fraudulent merchant behaviors) by improving risk event capture by 80-90% was provided.