BusinessWire India
Scottsdale (Arizona) [US], August 6: ChainIT and RS Software today announced a product alliance to bring risk-based authentication to account-to-account (A2A) payments. While card transactions have benefited from the 3-D Secure framework for over two decades, instant and irrevocable A2A payments lack a comparable industry-wide fraud-monitoring framework. The alliance addresses that gap through continuous identity and risk assessment.
Identity fraud and scams are among the costliest threats facing financial institutions. Javelin Strategy & Research's 2026 Identity Fraud Study estimates that traditional identity fraud drove $27.3 billion in losses in 2025. As adoption of FedNow® and RTP® expands for instant, irrevocable payments, fraud exposure is increasing. The Federal Trade Commission reported more than $12.5 billion in consumer fraud losses in 2024, up 25% year over year.
Regulation is also raising the bar. Effective June 19, 2026 (June 22 was the first banking day), Nacha's Phase 2 fraud-monitoring rules require all ODFIs, RDFIs, non-consumer originators, third-party senders, and third-party service providers to implement risk-based processes to identify unauthorized and misrepresented ACH payments. Furthermore, FedNow® and RTP® are equipping financial institutions with information that can help strengthen fraud measures.
Account takeover (ATO) and authorized push payment (APP) scams are among the fastest-growing fraud threats, exploiting a common weakness: identity is verified once and then assumed thereafter. The rise of GenAI, deepfakes, and increasingly sophisticated attacks is accelerating the need for continuous monitoring, transaction-level visibility, and automated screening. According to LexisNexis Risk Solutions, fraud prevention is shifting toward integrated, multi-layered defenses, with every dollar lost to fraud now costing North American financial institutions an estimated $5 and a majority of lenders reporting elevated customer churn tied to fraud.
The alliance evaluates identity and fraud risk continuously on every transaction in sub-seconds, rather than verifying identity once at onboarding and assuming it remains valid thereafter. RS Software's fraud and risk platform, RS IntelliEdge™, a composable, customizable, explainable, risk & fraud intelligence layer (on top of the client's existing fraud & risk tools), produces that evaluation as each payment happens, using behavioral, device, and contextual signals. ChainIT contributes biometric identity verification through ChainIT ID and ChainIT Organization ID, along with Validated Data Tokens (non-transferable, cryptographically anchored credentials that establish who authorized a payment and whether they had the authority to do so). No single signal, biometric or otherwise, is sufficient against AI-enabled attacks on its own; the framework evaluates multiple independent signals together on every transaction. When the combined score crosses thresholds set by the institution, its own policies determine whether to require biometric verification, hold the payment, or let it proceed.
The design counters account takeover directly: a criminal who steals credentials, hijacks a session, or swaps a SIM must still look like the customer across every signal, on every transaction. It also equips institutions to detect and interrupt authorized push payment scams before settlement, by surfacing coercion patterns and counterparty risk a deceived customer cannot see an effect that compounds at the network level, where visibility across institutions can expose mule accounts. Legitimate payments proceed without interruption, and additional verification is used only when risk warrants it.
The same protection extends to business payments, where everything starts with an agreement: entity identity is verified at onboarding and evaluated on subsequent payments, and Pactvera Smart Agreements bind each payment to the contract that authorizes it, one identity thread across B2B, B2C, and C2B flows. The financial institution always makes the final decision. In milliseconds, the framework supplies the risk, the reason, and the record: a continuously updated score, a plain-language rationale, and a signed, tamper-evident record of who authorized the payment and with what authority an audit trail designed to support fraud investigations and dispute resolution under Regulation E and UCC Article 4A.
The framework is also built to consume network-level intelligence from the payment networks themselves, including the FedNow Service's network intelligence API launched in April 2026, combining those signals with continuous behavioral, device, and contextual identity and fraud risk assessment to create a single pre-settlement risk picture, while the institution's rules determine what happens next.
"Identity verification is the primary gateway for preventing fraud, and Fraud Prevention has become the Core of Trust in payments. We are excited to partner with ChainIT to provide integrated front-line attack in this multi-billion-dollar market opportunity," said Raj Jain, CEO of RS Software.
"Faster payments only work if you know who is on the other end," said Jeremy Blackburn, CEO and Founder of ChainIT. "Our role is to prove who authorized a payment, confirm they had the authority to do it, and preserve the evidence in a form that supports dispute resolution. RS Software brings the risk engine that turns that proof into information a financial institution can act on in real time."
The framework is additive by design: its risk score feeds the fraud platforms an institution already operates, so nothing is ripped out and no core migration is required. The same capability is being integrated into ChainIT Pay for payment initiation and processing, RS DigitalEdge for open API and multi-rail orchestration, and Payabbhi for merchant acquiring and acceptance.
Proof-of-concept engagements, scoped to eight to twelve weeks, are now open for financial institutions treating fraud management as a strategic function, third-party service providers to mid-tier banks, credit union service organizations, and payment services providers serving various industry segments.
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