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The first phase of the Central Fraud Detection System (KVR) has been launched, which uses state-of-the-art technology to detect fraud targeting bank transfers in a fraction of a second.
The system was launched early Tuesday morning by the Central Bank of Hungary (MNB) and its subsidiary GIRO Zrt., and uses artificial intelligence to assess the risk of fraud associated with individual transactions. Under the relevant legislation, from July 1, 2025, domestic banks will be required to submit specific data on instant transfers to the Central Fraud Detection System. Banks are expected to incorporate the risk values received from the KVR into their own fraud detection systems. As a result of this development, the domestic banking system will be able to filter out attempts at abuse that threaten consumers’ money more effectively. In the coming period, the system is expected to be continuously developed based on the data received and experience gained in order to maximize its effectiveness.
The system, which is unique at the international level, is part of the central bank’s “five strikes” series of measures announced by Central Bank Governor Mihály Varga in early June.
The Central Bank of Hungary expects banks to take a much more active role in preventing abuse, which it will monitor through targeted investigations. The central bank is also initiating a legislative amendment to ensure that, in line with international practice, banks bear the loss in all cases where they have failed to apply appropriate customer authentication.
The MNB proposes extending the liability of banks to cases where the customer is persuaded to initiate a payment on behalf of the bank. In addition, the central bank will launch an information campaign on the risks of abuse and ways to prevent it.
Via MTI; Featured photo: Pexels