Cognizant, a US-based SJE Group investment, helped a client save USD$600,000 monthly by detecting fraud in realtime, while enhancing the customer experience.
Cognizant's client is a leading telecommunications provider operating in more than 20 countries. Like many telecom providers, the client offers a free or subsidised phone to subscribers who sign up for a multi-year plan to help win new business. But when fraudsters sign up just to get the phone —with no intention of paying their bills — losses were adding up. In fact losses from subscriber fraud amounted to tens of millions of US dollars annually.
To detect fraud, the company’s fraud agents manually checked each application against credit agency databases and cloud services. But data-entry errors sometimes led to inaccurate assessments that approved fraudsters for phones while denying credit-worthy customers. What’s more, the process typically took about a day, which meant approved customers had to make a second trip to the store to get their handsets. Automating the fraud assessment process would reduce loss while also improving the customer experience.
The client engaged Cognizant to automate the fraud detection process, building a real-time fraud risk assessment solution for store sales staff. Cognizant built a cloud-native, microservices-based application for real-time fraud assessment at the point of sale. The application integrates with an external credit agency, a fraud detection cloud service and the CRM system and then applies business rules to approve or deny the application on the spot — typically in less than one second.
Losses from subscriber fraud plummeted by USD$600,000 monthly and projects savings of USD$21.6M over three years.
Customer experience also improved: The scalable, cloud-native application currently processes 2,500 transactions weekly and can scale to 70,000. This means on-the-spot order approvals for customers. The solution also resulted in availability of 99.9% which helps to avoid long lines in stores.