Chase Paymentech LLC has agreed to offer card-not-present security services from Kount Inc. to all its merchant clients.
The Dallas processor said this week it plans to integrate Kount's anti-fraud technology into its systems, making the security features available to merchants without requiring them to negotiate separate pacts with the Boise, Idaho, vendor.
"What's new is the full integration into Chase Paymentech," said Greg Worch, the group executive for business development at the unit of JPMorgan Chase & Co. "This is the most ambitious and most significant step we've taken in this area."
The two companies have worked together since 2008, referring merchants to each other.
Chase Paymentech expects to begin offering the Kount technology in the second quarter, starting with large and midsize merchants. Pricing has not been decided.
Kount's system evaluates such factors as the shopper's location and whether a payment card has been used repeatedly to buy items within a certain period to provide a risk score to merchants at the same time they receive authorization codes from issuers, said Steve Rouse, Kount's chief operating officer. "The higher the number, the greater the risk."
Merchants will be able to set rules to flag potentially fraudulent transactions or automatically decline them, he said. For example, a 12th television purchase in two days made with a single payment card would increase the risk score. A merchant could also configure the system to automatically decline transactions originating in certain countries. Merchants would benefit from reduced chargebacks and fines associated with fraud by rejecting bogus transactions, Kount said.
Chase Paymentech says it processes half of all Internet transactions.