Mastercard (NYSE:MA) announced on Thursday that it will acquire the threat intelligence company Recorded Future from private equity firm Insight Partners for $2.65 billion. This purchase will enhance Mastercard’s ability to combat cyber threats, which have increased significantly due to the rapid adoption of new technologies.
Last year, Mastercard (NYSE:MA) processed transactions worth $9 trillion. As cyberattacks, including hacking and ransomware, become more common, companies like Evolve Bank in Arkansas have experienced data breaches, highlighting the urgency for stronger cybersecurity measures.
Mastercard Leverages Generative AI and Wants to Strengthen Card Fraud Detection and Cybersecurity Services
Mastercard (NYSE:MA) is already using generative AI technology to improve its card fraud detection capabilities. The company has been working with Recorded Future, which employs AI analytics to identify potential threats, providing alerts to financial institutions about compromised cards.
Since the service was launched earlier this year, the detection rate of compromised cards has doubled. This acquisition aligns with Mastercard (NYSE:MA)’s strategy to enhance its value-added services (VAS), particularly in cybersecurity.
TD Cowen analysts said it provides Mastercard (NYSE:MA) with additional tools to protect transactions, whether they’re processed through its network or not. The deal is expected to close by the Q1 2025 and is likely to support Mastercard (NYSE:MA)’s projected growth in VAS for FY 2025.
Mastercard (NYSE:MA) currently offers various cybersecurity services, including identity fraud prevention and real-time decision-making support for its clients. Insight Partners had previously acquired a controlling interest in Recorded Future in 2019 for over $780 million. Recorded Future serves more than 1,900 clients in 75 countries, including 45 governments.
Read also: Meta Platform’s AI Vision Drives Stock Surge and 2025 IPO Boom Looms as 2024 Market Stalls
