Business intelligence solutions organization, SAS Institute, has strengthened ties with global banking and financial services provider, HSBC Holdings, with the signing of a long-term partnership, in terms of which the two aim to transform the payment card fraud-detection market.

According to André Zitzke, solutions specialist for risk and compliance at SAS SA, the global partnership was officially announced two weeks ago, but joint development on the software solution has been running for over a year already.

SAS Institute notes that over US$2 billion is lost annually by banks and financial organizations across the globe, due to payment card fraud. Although banks, over the past decade, have developed improved processes and systems to identify and stop fraud, fraudsters have also adapted, and continue to do so rapidly.

Zitzke says that HSBC saw the need for a new generation of fraud detection. One that includes more sophisticated analytic intelligence, real-time decision making at the point of sale, and complete integration with antifraud measures -- such as chip and PIN -- across the industry.

?We chose to work with SAS primarily because of its technology assets, extensive R&D capability and its ability to support us across the globe. We are impressed with SAS? understanding of our business goals, and its flexibility to meet our demanding requirements,? says Siddharth Mehta, CEO at HSBC North America.

?By combining our proven ability to deliver robust and innovative predictive analytic solutions with HSBC?s banking ?know how? we have the ability to change the way that the industry looks at its fraud detection solutions,? says SAS CEO, Jim Goodnight.

?The solution is not currently available yet, but we are in the process of putting the final touches on the software and tweaking it to fit specific needs,? Zitzke says. He predicts that the solution will be ready by next year.

The new SAS solution will be implemented in all of HSBC?s major card businesses.

Zitzke says that the benefits of the new solution, in addition to reducing potential losses, include lower operational costs of fighting fraud, and a more flexible fraud platform.

?The solution will not just monitor a single account transaction, but will include a model that will monitor all transactions and the entire usage pattern of a customer including non-monitory transactions,? he adds. He further notes that the two companies are also developing a strategy to extend the technology into other transaction monitoring applications.