How Sift enabled Banxa to securely scale by 30x

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Banxa, a fast-growing public payments and compliance infrastructure provider for the digital asset industry, faced a significant challenge when its business volume increased by 30x. The company encountered multiple fraud scenarios, including fake profile creation, card fraud, scams, and chargebacks. Initially, Banxa had set up their own fraud function from scratch, handling everything manually when volumes were manageable. However, as Banxa began to grow, this basic model became too limited for their needs. It introduced unwanted friction for trusted customers and became riskier when incorporating multiple variables and increased velocity. So when Banxa’s volume spiked 30x, their fraud rate rose alongside it. The team knew they needed to implement something quickly to support their scaling business, which is where Sift came in.

Banxa is one of the fastest-growing public payments and compliance infrastructure providers for the digital asset industry. The company enables the purchase of digital assets and currencies such as Bitcoin or USDT using traditional fiat currencies, such as Australian dollars, euros, and pounds. Every 15 seconds, someone purchases cryptocurrency with Banxa. In 2021, Banxa was recognized by The Silicon Review as one of the “50 fastest-growing companies of the year.” The global team spans across 10 countries and has grown from a team of 25 to 120+ globally in the course of a year. As a payments and compliance infrastructure company, Banxa provides a secure and regulatory-compliant payment channel for digital asset businesses, from exchanges and wallets to apps. Banxa’s on and off-ramp product manages the entire value chain—from easy implementation, Know Your Customer (KYC), Anti-Money Laundering (AML) to the customer and technical support—to provide a seamless, secure experience while being internationally compliant.

Banxa built their fraud operations around Sift and the platform has become a primary component of their fraud control model. The team leverages Sift Payment Protection to measure daily fraud and chargeback rates, identifying and responding to any fraud patterns associated with certain partners or transaction methods. Sift also fits nicely within Banxa’s value chain, both for order creation and payment risk. To protect order creation, the team leverages Sift’s network of device intelligence and user session tracking to prevent suspicious users from creating orders. And to protect against payment fraud, they utilize Sift’s machine learning and data science capabilities to construct highly effective and automated detection strategies. With these capabilities, Banxa can automatically accept, hold, verify, and decline orders based on routing and rules. The team has even created a multitude of different watch decisions to segment the various types of user behavior on a spectrum from trusted to risky. They use the explore function to look at common attributes of fraud cases and pinpoint exactly when a user goes from trusted to risky. This is especially useful for complex scam activity, as it can often look like regular customer behavior.

• Banxa has been able to identify and auto-block fraudulent activity before any damage could ensue, resulting in reduced and stabilized fraud and chargeback rates.
• Once hamstrung by manual effort and limited on how they could respond to attacks, the team can now scale and quickly squash major attacks with ease.
• After initially dealing with an influx of scams that impacted trusted customers, Sift has helped Banxa significantly reduce these scam events.

• Reduced scam events by 80-90%
• Prevented more fraud with 5x fewer resources
• Helped the company securely scale by 30x