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Global information services company Experian has launched ‘Hunter', a fraud prevention service that allows banks and lenders to detect potential frauds.
This is done by analysing loan applications and looking for inconsistencies within the information provided by the borrowers, which could be an indication of something amiss, said Dr Richard Fiddis, Experian's Managing Director – Global Emerging Markets.
“Hunter identifies inconsistencies, not frauds, and leaves it to banks to verify or corroborate the evidence,” Dr Fiddis said.
Vulnerability
Recently, a report by a Working Group set by the Reserve Bank of India said that banks need to follow various fraud prevention practices, including fraud vulnerability assessments (for business functions and delivery channels), review of new products and processes, putting in place fraud loss limits, root cause analysis for actual fraud cases above Rs 10 lakh, in addition to following ‘know your customer' and ‘know your employee/vendor' procedures.
In its annual report for 2009-10, the RBI had reported 24,572 cases of frauds of value less than Rs 1 crore and 225 cases of large ticket frauds.
The Hunter application operates on two levels: Local – which helps banks detect internal inconsistencies across its own bank branches; and National – which helps banks detect inconsistencies across banks which have signed up to be members of the closed user group.
Hunter is available as a hosted service, on a pay-as-you use basis.
ICICI Bank and Axis Bank have signed up to use the service and also agreed in principle to share the data, said Mr Fiddis. Axis Bank has already gone live and ICICI Bank will do so in the next few weeks.
“There is no additional IT investment for the bank. There is only a nominal set up fee and a transaction fee based on volumes,'' said Mr Vikram Narayan, Managing Director and Country Manager, Experian, India.
The company also conducted proof of concepts, similar to a trial run, with about 10 Indian banks, including private, foreign and public sector banks.
These trial runs threw up inconsistencies such as the same applicant having different dates of birth, different addresses or different bank accounts numbers for separate applications.
Currently, Hunter has been launched in batch mode in India. The online mode, to check data provided in online applications will be launched within one year.
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