Stripe acquires Bouncer to boost its fraud detection tool

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The acquisition is seen as a way to enhance Stripe’s own “Radar” fraud detection solution.

Stripe announced this week that it has acquired Bouncer, a company building card authentication technology to reduce fraud during online transactions. The companies are not disclosing the terms of the deal, but Stripe is acquiring both Bouncer’s technology and the team, according their press release. This will serve to “further enhance the capabilities of Radar, Stripe’s machine-learning-based fraud prevention tool,” the company says.

Bouncer’s card scanning and risk technology helps online businesses reduce fraud and authenticate cards. Stripe will integrate Bouncer into Stripe Radar, a fraud prevention tool whose machine learning models focus on purchases made at millions of companies around the world every day.

Groupon is among the customers that Bouncer currently works with, alongside OfferUp, ibotta and Dealerware. Bouncer will keep its current service and customers up post-deal.

Adding ML powered fraud detection to the Stripe platform

Radar is an integral part of Stripe’s payments platform. When it identifies a specific transaction as high risk, Radar will use Bouncer’s card scanning and verification technology to confirm that an end customer has a legitimate card in their hands at the time of the purchase. This extra layer of protection will reduce false positives among potentially high risk transactions, Stripe says.

Stripe offers Radar in a number of tiers. The prices vary depending on how the customer uses the service. For example, there is a more basic machine learning tier, and an enhanced tier for fraud teams. The price also varies depending on whether customers are using Stripe’s standard pricing fees or something else.

The acquisition of Bouncer follows Stripe’s having raised $600 million earlier this year. In fact, the company has been on an acquisition spree ever since, acquiring companies such as TaxJar to help build its business systematically.

“Bouncer is a great tool for modern internet businesses. It allows them to quickly identify stolen cards, while also ensuring legitimate customers can transact without being blocked,” said Simon Arscott, business lead for Stripe Radar.

“With the addition of advanced card scanning capabilities, Stripe Radar will be able block more fraud and further increase revenue for millions of businesses around the world who rely on Stripe.”