Brad Wiskirchen, Kount: "Payment processing is a commodity, fraud control is a neccesity"23-Oct-2014
The burden of fraud prevention no longer lies solely with the merchant as regulators look up the payment chain to tackle fraud.
Could you elaborate more on Kount Central and its strengths in comparison with other products?
Kount has a long history of providing comprehensive enterprise-level fraud and risk management solutions. The company has been doing this since 2007 and has been very successful in serving merchants of all sizes. Kount’s comprehensive solutions bring together all the elements needed for fraud control. The company owns all of its core technologies and, because of this, is able to offer a very simple integration providing everything from device fingerprinting and proxy piercing to case management and business analytics. Kount is committed to offering an end-to-end, single-source solution focused on speed, simplicity and ease of use, with a no-compromise approach to providing real-time accuracy in results.
Therefore, Kount gives merchants the opportunity, the freedom and the confidence to grow their sales at the same time as their resistance to fraud. We anticipate tremendous changes ahead, whether they are driven by data breaches or account takeover cases. These changes are bound to happen even with the upcoming roll out of EMV in the US in 2015, which is aimed at reducing fraud and combating counterfeiting. We have realised that the needs of the PSPs are not dissimilar to the merchants’ when it comes to fraud prevention. Combating commoditization is beneficial for all. Therefore, in order to help payment gateways tackle the problems they are currently experiencing, and will continue to experience, we have designed Kount Central. The service has three main modules including Kount Central Enterprise, Kount Central Fraud Manager and Kount Central Portfolio Manager.
Kount Central Enterprise enables processors to add value and increase the retention of their largest and highest volume customers. It offers a direct link into Kount’s comprehensive platform of tools and analytics. This level of Kount Central is a direct response to processors looking for ways to add value and step away from the price compression for these merchants.
We created a single integration point at the processor so we can give the processor the ability to provide their merchants enterprise-level fraud solutions within minutes, rather than hours, weeks or months. Within an hour, they can go from no fraud solution to a complete enterprise fraud solution. By removing this roadblock, Kount Central gives processors and gateways the ability to provide other value-added services and compete in the marketplace. Currently, payment processing is a commodity and fraud control is a necessity. We have learned from our biggest processing clients that fraud prevention is not optional anymore. When they go into RSPs, they find that it’s a condition preceding the entry into that RSP, they have integrated fraud control.
The second use case is Kount Central Fraud Manager, which gives processors the ability to provide smaller merchants, and even long-tail merchants, a simple yet effective fraud system, giving payment processors new value-added services. This service allows processors to develop their own custom dashboard interface with the capability for merchants to set fraud and risk parameters for their individual business. It is simpler than the highly sophisticated rules that go on in Kount Enterprise, but it gives a small or mid-sized company what it needs to control or grow their business. When they grow larger they can always migrate to Kount Enterprise.
The third case, Kount Central Portfolio Manager, is aimed at protecting the entire portfolio – every transaction within a payment processor or aggregation payment portfolio, with a ‘blanket of protection’ over all transactions. One way we did this was on the front-end they are able to leverage our technology into the underwriting process, to evaluate merchants, to determine which merchants are inherently riskier or less risky. Then they are able to have an entire view of the whole portfolio, of all the merchants and all the transactions and figure out which merchants have had any difficulty with fraud.
The positive response to Kount Central has been remarkable both from small to very large payment processors, acquiring banks and aggregation points.
Which are the payment processors or banks that have already started working with this solution?
There are several partners we have already started working with, including Braintree, Merchant e-Solutions and Chase Paymentech, which, although they are not using Kount Central (they have been a partner for years), are using Kount technology very effectively at the payment aggregator level. With the launch of Kount Central, more companies will follow now that integration at this level has been significantly simplified. Like previously mentioned, the feedback to Kount Central has been positive. Businesses don’t have to use all cases, they can choose any one or all modules for their particular needs.
What steps can smaller enterprises take to ensure fraud prevention in order to compete with their larger rivals?
What merchants really need to do, regardless of their size, is take an approach to evaluating what their progress is, inventorying the data that they have, measuring their indicators and implementing best practices, such as geo-location, identity protection, and proxy piercing to name but a few of the many techniques. They have to understand that, regardless of their size, they are a potential target for fraudsters and the damage can be significant, with no silver bullet to completely eliminate fraud. It takes a collection of tools and techniques, which will be different depending on each business.
We actually provide a portfolio of solutions to merchants to help them combat fraud in every aspect of their business. For example, this year alone, we have launched three products: Kount SMB, Kount Access and Kount Central. Kount SMB is designed to provide small-to-medium businesses with fraud prevention which is simple and affordable. If their processor does not provide them with a service through Kount Central, then this is a good way for merchants to get fraud prevention directly through us. A second solution we have launched this year is Kount Access, which gives merchants the ability to fight the account takeover fraud they may be experiencing. Finally, the third solution we have launched this year is Kount Central.
What is innovative about Kount’s products is our technology and the way we integrate it together in total. It is worth mentioning that we are a part of the payment ecosystem, meaning that we provide fraud and intelligence about transactions, but we are not a payment processor, nor a gateway. We are one of the few folks that approach the industry in this way. Many of our competitors have a gateway as a component of their business. We are helping payment processors grow from a commoditized service to becoming a strategic partner and a trusted advisor where they can help their merchants learn more about their customers.
With a single integration at the aggregation point at the payment processor, we can enable hundreds and thousands of merchants to use Kount Central.
Some of Kount’s future plans include…
Over the next year you will see additional releases that address the commoditization of the payment processing, but there will also be a focus on utilizing the data we collect to strengthen business decisions providing merchants with valuable business intelligence in order to enhance marketing, sales and even expansion plans in order to enhance the ability to boost sales.
About the author
Bradley J. Wiskirchen is the CEO of Keynetics and its subsidiary Kount. He is also the Executive Chairman of Keynetics’ subsidiary ClickBank. Wiskirchen joined Keynetics in 2005. Under his guidance, Keynetics has become one of the Pacific Northwest’s largest privately held technology companies. Kount has become the premier fraud prevention solution for card-not-present merchants and payment platforms, and affiliate marketing giant ClickBank has grown to be one of the world’s largest online retailers of digital goods.