[crmd]

> Drawback: this doesn’t work until you have history. New accounts have no baseline.

This is an underrated CX factor: If my card gets denied when i’m a new customer or exhibiting a new pattern, i’m impressed with their software.

However if they deny a transaction where there is any previous history of me authenticating, then I’m frustrated by their naive paranoid algorithm.

[chii]

The incentives of the bank is to cut fraud.

Fraudulent transactions will eventually cost the bank (when they would have to reverse/reimburse it and eat the loss). A denied transaction only results in an angry customer who will quickly forget after they complained - so the customer bears the brunt of the externalized cost.

Therefore, the bank's incentive is to err on the side of more caution, and deny transactions when finding false positives.

[crmd]

Spend retention is by far the highest priority. This is why they overnight fedex replacement cards.

The worst scenario for a credit card issuer is when a customer, for whatever reason, starts using another bank’s card in their wallet as their daily driver.

[kikimora]

When someone disputes a charge and wins banks charge processor and the original merchant. The bank won’t loose a penny, merchant will.