Mastercard Incorporated MA recently expanded ties with one of Africa’s leading identity verification providers, Smile ID, in a bid to accelerate the adoption of secure digital identity solutions across the continent.
This partnership will merge Mastercard’s global expertise and digital identity technology with Smile ID’s advanced verification and fraud detection systems. The company has made a minority investment in Smile ID as part of the deal.
The resultant benefit will be reaped by Mastercard’s customers, including banks, fintechs, mobile money operators and enterprises. They will get access to Smile ID’s advanced identity verification technology, which will be seamlessly integrated into Mastercard’s digital platforms, enabling faster and more secure onboarding of users across African markets.
The solutions will also strengthen fraud detection and prevention efforts, including the growing challenge of synthetic identity fraud, while ensuring compliance with both local and international KYC and AML standards. In addition, the partnership will support scalable models for cross-border commerce and digital expansion, allowing businesses to serve a wider base of customers with greater confidence and efficiency.
The recent initiative seems to be a time-opportune move on account of a rapid rise of synthetic identity fraud across Africa and this has been costing banks and lenders hundreds of millions of dollars each year. Also, a rapidly expanding digital economy across Africa necessitates the need for reliable identity solutions.
Benefits of the Recent Move to Mastercard
Increased usage of Mastercard digital identity solutions is expected to fetch greater revenues from the increased utilization of its value-added services and solutions. Its net revenues improved 17% year over year in the second quarter of 2025.
Mastercard boasts a comprehensive portfolio of fraud detection solutions and pursues partnerships and significant investments for upgrading its cybersecurity suite. In September 2025, it solidified ties with a worldwide leader in identity-focused security solutions, Entrust, as a result of which Mastercard Identity insights will be integrated into the Entrust Identity Verification Security Platform. It will provide affordable, risk-based verification by automating processes with real-time fraud scores.
Other Companies With Advanced Fraud Protection Tools
Apart from Mastercard, other companies that contain enhanced fraud detection tools are American Express Company AXP, Visa Inc. V and PayPal Holdings, Inc. PYPL.
American Express offers fraud detection solutions that leverage AI, machine learning, predictive analytics and behavioral analysis to monitor transactions in real time. These tools work with its global detection platforms and merchant partnerships to identify and prevent suspicious or fraudulent activity. Total revenues, net of interest expense, rose 9% year over year in the second quarter of 2025.
Visa combats fraud with a layered suite of tools. Visa Advanced Authorization applies AI-driven, real-time analytics to score every transaction, enabling issuers to block suspicious activity instantly. Visa Risk Manager adds customizable monitoring and case management, while Payment Fraud Disruption leverages global data and machine learning to uncover fraud patterns at scale. Net revenues advanced 14% year over year in the third quarter of fiscal 2025.
PayPal employs a multi-layered fraud detection framework that combines proprietary technologies and advanced analytics to safeguard transactions. Its system integrates AI and machine learning models that analyze vast amounts of data in real time to detect unusual behavior, flagging potentially fraudulent activities before they escalate. PayPal also leverages device fingerprinting, geolocation analysis and behavioral biometrics to identify suspicious patterns. Total revenues rose 5% year over year in the second quarter of 2025.
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Mastercard Incorporated (MA): Free Stock Analysis Report Visa Inc. (V): Free Stock Analysis Report American Express Company (AXP): Free Stock Analysis Report PayPal Holdings, Inc. (PYPL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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