A sharper focus on real-time fraud detection is beginning to pay off for banks as financial criminals increasingly rely on more sophisticated tactics. Bank of Ireland says investments in artificial intelligence have significantly reduced payment fraud losses while making the process less disruptive for customers.
AI System Delivers Measurable Fraud Gains
Bank of Ireland has reported a 30% reduction in attempted payment fraud and a 25% fall in customer losses since introducing an AI-powered fraud detection platform in 2024.
The system, developed with Featurespace, a Visa Solution, uses machine learning to analyse how customers normally use their accounts and identify unusual activity before transactions are completed. The approach allows the bank to detect emerging fraud patterns without relying solely on traditional rule-based controls.
According to the bank, the technology has also improved operational efficiency. Case handling times have been cut in half, while false-positive alerts have dropped by 87.1%, reducing unnecessary payment interruptions for customers.
Alert volumes have declined by 85%, enabling fraud teams to concentrate on higher-risk cases rather than reviewing large numbers of legitimate transactions. Around 90% of customers are now able to verify genuine transactions without needing to contact the bank.
Customer Experience Improves Alongside Security
The bank said the objective was not only to prevent losses but also to reduce friction for customers.
By using behavioural analysis and real-time pattern recognition, the platform is able to distinguish between legitimate spending and suspicious activity more accurately, limiting the number of genuine payments being flagged for review.
The initiative highlights how banks are increasingly using AI to strengthen fraud defences while maintaining seamless payment experiences, particularly as scams become more sophisticated and payment volumes continue to rise.
Industry Recognition for Fraud Strategy
The programme has also received industry recognition, with Bank of Ireland earning Celent’s 2026 Model Risk Manager Award for its use of technology in fraud prevention.
Visa said adaptive AI-based systems are becoming increasingly important as criminals adopt more advanced methods and attack patterns. Unlike static controls, intelligent decisioning models can continuously learn and respond to changing fraud behaviours without increasing customer friction.
The results underscore a wider trend across banking, where AI is moving beyond experimentation and delivering measurable outcomes in areas such as fraud prevention, operational efficiency and customer protection.
What this means for the industry
- Banks are increasingly using AI to combat fast-evolving payment fraud.
- Real-time behavioural analytics can reduce losses without adding friction for customers.
- Lower false positives improve customer experience and reduce operational costs.
- Fraud teams can focus resources on genuinely suspicious transactions.
- AI-based fraud prevention is becoming a key competitive differentiator for banks.
