Greg Ulrich: Mastercard has used AI for decades in fraud detection, generative AI enhances existing products, and real-time transaction scoring is key to security | a16z Live

Key Takeaways

• Mastercard has integrated AI into its operations for decades, focusing on fraud detection and personalization.
• Generative AI is used as a feature to enhance existing products, not as standalone solutions.
• AI plays a critical role in Mastercard’s fraud management strategies, securing the ecommerce ecosystem.
• Real-time transaction scoring is a key component of Mastercard’s decision intelligence product.
• Generative AI streamlines the onboarding process for banks and merchants by automating manual tasks.
• Data security is paramount for Mastercard, crucial for maintaining trust and brand reputation.
• Mastercard prioritizes partnerships based on strategic alignment and solution feasibility.
• The company has a history of collaborating with early-stage fintechs, fostering innovation.
• The hub and spoke model facilitates coordinated innovation across Mastercard’s business units.
• AI is employed to understand transaction history and merchant behaviors for better security.
• Mastercard’s strategic focus on AI aims to drive value for customers and shareholders.
• Partnerships with early-stage companies are integral to Mastercard’s market strategy.
• AI enhances transaction security by creating merchant vector databases for fraud detection.
• Mastercard’s approach to AI emphasizes problem-solving and specific use cases.
• Safeguarding data is at the core of Mastercard’s operations, recognizing the potential risks.

Guest intro

Greg Ulrich is the Chief AI and Data Officer at Mastercard and a member of the company’s Management Committee. He previously served as Executive Vice President of Corporate Strategy and M&A, guiding Mastercard’s Data & Services strategy and leading its North America operations. He joined Mastercard in 2015 through its acquisition of Applied Predictive Technologies, a leading cloud-based analytics company.

Mastercard’s long-standing AI integration

• Mastercard has been using AI for decades, especially in fraud detection and personalization.

• We’ve been using AI for decades… it’s inherent in everything we do in fraud detection

  — Greg Ulrich

• AI is foundational to Mastercard’s operations, highlighting its role in security and customer service.
• Mastercard’s AI applications include personalization forecasting intelligence products.
• The company’s long history with AI underscores its commitment to technological innovation.
• AI’s role in Mastercard extends beyond fraud detection to include customer personalization.

• Artificial intelligence is behind a lot of what we do in personalization

  — Greg Ulrich

• Mastercard’s experience with AI positions it as a leader in integrating technology into financial services.

Generative AI as a feature, not a product

• Generative AI is integrated into existing products to enhance capabilities based on use cases.

• GenAI is a feature as opposed to a product in other places

  — Greg Ulrich

• The distinction between generative AI as a feature versus a standalone product is crucial.
• Mastercard uses generative AI for digital assistance and other solutions.
• AI’s application is driven by specific problems and use cases.

• It comes back to the problem, it comes back to the use case and what we’re trying to solve for

  — Greg Ulrich

• Generative AI enhances existing solutions rather than replacing them.
• Mastercard’s approach to AI focuses on practical applications and problem-solving.

AI’s role in fraud management

• Fraud management is a primary focus for AI applications at Mastercard.

• A lot of what we’re doing today is in fraud management, fraud detection

  — Greg Ulrich

• AI aims to secure the ecommerce ecosystem by enhancing fraud detection.
• Mastercard’s strategic priorities in AI include improving security measures.
• AI’s importance in fraud management highlights its role in protecting transactions.

• We’re doing things to make the ecosystem secure

  — Greg Ulrich

• Mastercard invests in AI to enhance security and protect customer data.
• The company’s focus on fraud management demonstrates its commitment to safety.

Enhancing transaction security and personalization

• Mastercard uses AI to enhance transaction security and personalization.

• We use GenAI, recurring neural networks, and other technologies

  — Greg Ulrich

• AI integrates into fraud detection and customer personalization strategies.
• Mastercard employs technical mechanisms to improve transaction security.

• Understanding not just your transaction history but the overall ecosystem of merchant behaviors

  — Greg Ulrich

• AI creates merchant vector databases to assess transaction risks.
• Mastercard’s use of AI showcases its innovative approach to security.
• The company’s focus on personalization enhances customer experiences.

Real-time transaction scoring

• Mastercard’s decision intelligence product provides real-time transaction scoring.

• We’re providing a score on that based on how likely that is a good or bad transaction

  — Greg Ulrich

• Real-time scoring is crucial for fraud prevention and operational efficiency.
• Mastercard processes transactions with a focus on real-time analytics.
• The company’s emphasis on real-time scoring highlights its commitment to security.
• AI’s role in transaction scoring underscores its importance in Mastercard’s operations.
• Real-time analytics are integral to Mastercard’s approach to fraud detection.
• The decision intelligence product enhances transaction security through real-time insights.

Streamlining onboarding with generative AI

• Mastercard leverages generative AI to streamline the onboarding process for banks and merchants.

• We’ve created a digital assistant that uses RAG and points to all these technical databases

  — Greg Ulrich

• AI automates manual tasks to improve customer experience and efficiency.
• The onboarding process is simplified through technology, enhancing operational workflows.
• Mastercard’s use of AI addresses technical challenges in product integration.
• Generative AI plays a key role in improving customer interactions and satisfaction.
• The company’s focus on automation reflects its commitment to innovation.
• AI’s application in onboarding highlights its potential to transform operational processes.

Data security as a priority

• Safeguarding data is paramount for maintaining Mastercard’s position as a trusted brand.

• We put the safeguarding of data at the absolute pinnacle of what we need to do

  — Greg Ulrich

• Data security is crucial for brand trust and customer relationships in the payment industry.
• Mastercard recognizes the potential risks associated with data protection.
• The company’s emphasis on data security underscores its commitment to customer safety.
• AI plays a role in enhancing data protection measures at Mastercard.
• Safeguarding data is integral to sustaining Mastercard’s reputation and success.
• The focus on data security highlights Mastercard’s dedication to responsible operations.

Strategic partnerships and fintech collaboration

• Mastercard prioritizes partnerships based on strategic alignment and solution feasibility.

• We’re prioritizing where we’re spending our time

  — Greg Ulrich

• The company evaluates potential partnerships based on focus areas and feasibility.
• Mastercard has a long history of partnering with early-stage companies.

• We embrace the early-stage community and we’re looking to partner with them

  — Greg Ulrich

• Collaboration with fintechs is integral to Mastercard’s market strategy.
• The company’s commitment to innovation is reflected in its partnerships.
• Mastercard’s approach to partnerships emphasizes strategic alignment with focus areas.

Coordinated innovation through the hub and spoke model

• The hub and spoke model allows for coordinated innovation across business units.

• The way the hub and spoke model works is… looking at where we think the technology is the greatest opportunity

  — Greg Ulrich

• This model leverages enterprise-wide insights for innovation.
• The approach balances centralized oversight with decentralized execution.
• Mastercard’s organizational structure supports strategic decision-making.
• The hub and spoke model facilitates innovation while maintaining alignment with company goals.
• Coordinated innovation is crucial for large organizations like Mastercard.
• The model enables Mastercard to drive value for customers and shareholders.