BioCatch acquired by Visa for $2.4B

Visa announced yesterday that it had reached a definitive agreement to acquire the behavioral biometrics anti-fraud solution provider BioCatch in an all-cash deal for $2.4 billion. The transaction is expected to close by the end of Visa’s second fiscal quarter in 2027.

BioCatch’s acquisition by Visa is expected to help the latter’s clients better protect themselves and their customers from the growing threat of account takeovers, scams, money mules, and application fraud. BioCatch will become part of Visa’s  Value-Added Services (VAS) division, where it will continue to serve banks and other financial institutions.

“Account takeovers and scams cost the global economy over $1 trillion annually and AI is enabling these attacks at unprecedented scale,” said Andrew Torre, president of Visa’s Value-Added Services division. “BioCatch will help our clients stop fraud before it reaches the point of payment. This acquisition is part of our strategy to help clients prevent cyber threats upstream while continuing to protect transactions as they occur, building trust into every transaction.” 

The acquisition of BioCatch builds on Visa’s existing suite of products, providing AI-powered solutions to detect and prevent fraud and both cyber and financial crime, from account opening to transactions. Over the last five years, Visa has invested more than $13 billion in technology and infrastructure to safeguard the integrity of the payments ecosystem and accelerate the decline in fraud rates.

Fraudbeat previously reported about BioCatch in 2018, when it received a $30 million round of growth funding backed by American Express Ventures.

The Importance of Determining Customer Intent

“Real-time insights into customer intent continue to grow increasingly essential for institutions to establish trust within digital banking sessions,” BioCatch CEO Gadi Mazor said. “For more than a decade, we’ve demonstrated behavior’s unique ability to distinguish the criminal from the legitimate. In the last couple of years, we’ve shown how real-time intelligence-sharing networks between our customers can amplify the power of our behavioral intelligence further still. Together with Visa, we’re even better positioned to advance our mission of making the world a safer place to transact and protect consumers from financial crime.”

Mazor specifically pointed to the switch from confirming user identity to assessing user intent as a major trend in the fraud prevention market, one which helped influence Visa’s decision to acquire BioCatch.

“Pivoting from point-in-time authentication to a continuous assessment of user intent is no longer some prescient strategy shift deployed by the world’s most forward-thinking banks,” Mazor wrote in a blog post on the BioCatch site. “It’s rapidly becoming the status quo for those institutions serious about protecting their customers and reducing operational expenses.”

BioCatch to Continue Operating as a Unit Within Visa

Mazor will continue to lead the BioCatch organization within Visa post-acquisition.

Since its inception, BioCatch has developed innovative AI and machine learning-based solutions that analyze thousands of application, behavioral, device, and network signals — such as keystrokes, touch gestures, and device handling — to detect fraud and distinguish legitimate users from fraudsters in real time. BioCatch protects 1.8 billion devices and 760 million users around the world, serving more than 350 banking clients in 21 different countries, including more than 100 of the largest banks globally.

Uri Rivner, who joined BioCatch in 2012 as a co-founder and Chief Cyber Officer, and is now co-founder of Refine Intelligence, summed up succinctly the significance of the acquisition.

“Fraud is an ever changing battle, and behavioral biometrics proved to be the strongest signal in every fraud team’s arsenal,” Rivner told Fraudbeat following the announcement of the acquisition. “It’s amazing to see how BioCatch became such an integral part of the core strategy banks deploy against account takeover and scam attacks. Congrats to the management team led by Gadi Mazor and hats off to Visa for recognizing the power of behavior.”