Featured Startup: xPay clarifies that mysterious transaction on your bank statement

Have you ever sat and stared at a transaction on your bank statement, completely oblivious about where it came from?

Sixty per cent of inquiries banks receive are from customers who don’t recognize a transaction on their bank statement. A lot of the time there’s no fraud involved. Instead, the bank doesn’t have the data to display the transaction details accurately.

This is a problem that xWare 42, a software developer from Munich, is trying to solve. CEO and co-founder David Lais tells us more.

“Transactions appear on your statement in a cryptical way,” Lais said. “That lack of data is what we’re trying to fix.”

The company’s core product xPay allows banks to give customers additional information about their purchases by collating data that is often freely available online, but that banks have yet to harness.

“A lot of the time we start with a simple Google search and then filter and validate the info that the web provides,” he added.

The xPay platform extends payment information to addresses, opening hours, service numbers and much more details from and about retailers.

“With xPay, the user can see the merchant name and service number, which is useful for customer and bank,” Lais said. “For a customer, it gives them a better insight into their finances by telling them exactly what they bought and from whom. For a bank, it helps with customer enquiries, and especially with fraud systems.”

 “As we go digital and banks want to be cool and validate in real time, there become problems with merchants like Apple and Amazon. But really, a payment going through Luxembourg is completely normal if you’re buying from iTunes.”

 “If you’re buying an airline ticket your bank knows who you’ve made a purchase from but doesn’t know what it is. We allow them to find out more info about flight, so they know knows that it is completely normal for your bank card to be used in New York over the next week.”

 xWare42 has also partnered with BehaviourSec, a security protocol that figures out you use any kind of device, which is as unique as your fingerprint, to secure xPay.

“We were the first to really implement them and show what they can do,” Lais said.

 “Obviously, every customer who would like to open a bank account or credit card has to go through the KYC process to verify their identity. One of the applications we were involved in was flagged up because the documents provided had been identified as having been faked. The standard procedure to follow in such cases is to check whether the fraudster might have further accounts under stolen identities, which is an approach fraudsters often use.”

 “Analysing key technical data such as IP address and browser fingerprints etc was not able to identify accounts run by the same person. However, when we analysed the behavioural patterns of this suspicious account and compared them to the patterns of our other customers, we were able to identify a whole lot more accounts characterised by identical behavioural patterns.”

 “To put a long story short, behavioural analysis allowed us to identify additional accounts opened by a fraudster with stolen identities, which would not have been possible using standard methods based on technical data.”

So far, xPay has a couple POCs in place with German banks in order to figure out how the solution can be used in the traditional banking experience, Lais said, and used by a paying customer on a day to day basis.

“We’re also looking at America while we optimize the algorithm and get more German banks to sign up as partners,” he added.

“We’re definitely interested in building more partnerships. Part of that is trying to build bridges between merchants and banks. Right now they’re not the best of friends, but merchants can provide extra data to banks about a purchase.”

“For example, if a dishwasher breaks down, a bank can act as a centre for information. A consumer can find the transaction details in their statement, which will have extra information attached, telling you how much warranty you have left, and which service number to call.”

 “This information is already available on the web, but has yet to be linked to a payment,” he said.



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