PayPal continued its acquisition streak with the recent acquisition of Simility, a specialist in AI-based fraud and risk management. The California-based company offers AI and machine learning-based tools to online merchants to help prevent fraudulent transactions.
The deal is said to be worth $120 million, in all cash. Paypal was previously an investor in Simility, with a 3 percent stake in the company. The deal is expected to close in Q3.
Similitys fraud management platform uses a set of APIs and beacons that monitor digital transactions and buying activity wherever they happen to take place: on mobile, web or in physical environments. Augmenting these with machine learning and feeds from other data sources, it creates something it calls “adaptive” risk management: a changing approach and protection strategy based on what the threat of the moment might be.
“Digital commerce has exploded, and fraudsters have taken note, adapting and developing new methods to carry out their crimes,” said Bill Ready, chief operating officer, PayPal, in a statement. “PayPal has been at the forefront of developing innovative fraud prevention and risk management solutions for nearly 20 years, but until now, merchants haven’t been able to configure those solutions to manage the unique complexities of their businesses. Together with Simility, we will be able to put more control in the hands of our merchants to fight fraud while helping make commerce experiences faster and more secure.”
Recent acquisitions by PayPal include European mobile payments and financial services business iZettle, payments aggregator Hyperwallet and AI-based CRM specialist Jetlore.
Online fraud continues to be a problem for ecommerce merchants of all sizes. Paypal’s acquisition of companies like SImility help arm their 237 million customers with the tools they need to keep their transactions safe and platforms running smoothly.