Outpacing Fraud: Why BFSI Needs AI + Human-in-the-Loop for Proactive Fraud Prevention

Fraud in banking, financial services, and insurance (BFSI) has evolved from isolated incidents to sophisticated, coordinated attacks. In 2024, scams overtook digital payment fraud as the most prevalent threat, with financial losses surging 121%. Meanwhile, fraudsters increasingly use advanced AI tools like deepfake technology and synthetic identity generators.

Financial institutions face significant losses, regulatory penalties, and reputational damage if they fail to act decisively. Our solution? Combining Artificial Intelligence with Human-in-the-Loop (HITL) approaches.

That's what Alorica and Pasabi are partnering to tackle: combining 25+ years of CX expertise with advanced AI fraud prevention to stop fraudsters before they start.

From Reactive to Proactive Prevention

Traditional reactive fraud prevention—responding after incidents occur—is no longer viable when a single breach can cost millions and erode customer trust. Proactive prevention means identifying and stopping fraud before it escalates, moving beyond retrospective analysis to real-time pattern detection powered by AI and informed by human judgment.

The AI + Human Advantage

AI delivers speed, scale, and pattern recognition that surpass human capabilities, processing millions of transactions at a time ​to​ identify anomalies. AI-powered behavioral analytics understands normal customer behavior like transaction patterns, device usage, login habits to quickly spot deviations signaling fraud.

Human analysts provide context, make judgment calls, and refine AI outputs. HITL enables systems to learn from edge cases and continuously improve, creating scalable intelligence grounded in human expertise.

Key Benefits

Early Detection: AI flags irregularities in real time while human analysts validate threats and escalate when necessary, reducing the window between fraud attempt and intervention.

Adaptive Defense: Human analysts feed new insights back into AI models, helping systems recognize evolving tactics like AI-generated phishing campaigns.

Fewer False Positives: Human oversight ensures legitimate transactions aren't unnecessarily blocked, improving both security and user experience.

Compliance Ready: Human-plus-AI decisions can be documented, reviewed, and explained, which is critical in regulated environments.

Trust Protection: Proactive fraud prevention avoids reputational damage and customer churn that follow large-scale incidents.

Why Partner with CX and AI Experts

Effective AI fraud prevention requires specialized expertise in both customer experience and artificial intelligence. The Alorica-Pasabi partnership delivers faster time-to-value than organizations can achieve alone: with solutions operational quickly, zero maintenance requirements as AI learns continuously from human analysts, and a virtuous cycle where technology automates repetitive tasks while human insights improve decision-making. The result: better fraud detection without the internal resource burden.

Building Future-Ready Defense

To keep pace with AI-empowered fraudsters, BFSI organizations must:

• Invest in agile, explainable AI that adapts to emerging threats
• Integrate human analysts into detection workflows
• Establish feedback loops so human insights continuously train AI systems
• Ensure transparency and auditability for compliance and trust

Conclusion

Fraudsters already use AI to scale operations and outsmart legacy defenses. For BFSI, the only way to get ahead is to be smarter and faster than the adversary through a proactive, hybrid approach where AI and human intelligence work together.

With the right balance of automation and human oversight, institutions can catch fraud early, minimize losses, and protect the foundation of their business: trust.

Learn more about Alorica Digital Trust and Safety solutions here.