What is Riskified?

Riskified is a leading third-party e-commerce fraud prevention and risk management platform. Founded to combat the high rates of false declines and chargebacks in online retail, Riskified uses advanced machine learning algorithms to analyze transaction data in real-time, accurately separating legitimate customers from fraudulent actors.

Riskified is perhaps best known for pioneering the Chargeback Guarantee model, fundamentally shifting the financial liability of Card-Not-Present (CNP) fraud away from the merchant.

How the Chargeback Guarantee Works

Historically, merchants relied on rigid, rules-based fraud filters provided by their Payment Service Providers (PSPs). These filters generated a "risk score," leaving the final decision—and the ultimate financial liability—in the merchant's hands.

Riskified altered this dynamic by providing definitive "Approve" or "Decline" decisions on every order evaluated.

• If Riskified approves an order: The merchant proceeds with capturing the payment. If that specific transaction later results in a fraud-related chargeback, Riskified reimburses the merchant for the full cost of the lost goods and the chargeback fee.

• If Riskified declines an order: The merchant stops the fulfillment process, preventing the loss of inventory and avoiding an authorization fee.

Because Riskified's revenue is typically tied to the volume of approved orders, their machine learning models are heavily incentivized to safely approve as many transactions as possible, driving up the merchant's top-line revenue while protecting the bottom line.

The Role of Machine Learning in Fraud Detection

To confidently offer a chargeback guarantee, Riskified analyzes billions of historical transactions across its global merchant network. When a new transaction occurs, the platform evaluates hundreds of data points in milliseconds, including:

• Device Fingerprinting: Identifying if the device has been used in previous fraudulent attacks.

• Behavioral Analytics: Analyzing how the user navigates the site, types, and interacts with the checkout page.

• Proxy and VPN Detection: Unmasking the true IP address and geographic location of the buyer.

• Cross-Merchant Identity Linkage: Recognizing a returning good customer even if they are shopping on a new website for the first time.

Integrating Riskified via Hellgate.io

Integrating a sophisticated third-party fraud engine like Riskified directly into a legacy, monolithic PSP can be an engineering nightmare. Hellgate’s Composable Payment Architecture (CPA) turns this complex integration into a simple, programmable routing rule.

Seamless Orchestration via Hub

The Hellgate Hub acts as the intelligent orchestration layer between your checkout, your fraud providers, and your acquiring banks. When a customer initiates a transaction, the Hub can automatically send the payload to the Riskified API for evaluation before routing it to the processor.

If Riskified returns an "Approve" decision, the Hub instantly forwards the transaction to your optimal acquiring bank. If Riskified returns a "Decline," the Hub drops the payload at the edge, ensuring you do not pay unnecessary gateway authorization fees for a fraudulent order.

Layered Defense with Specter and Guardian

For maximum enterprise security, Hellgate allows you to layer your defenses. You can utilize Hellgate Specter to instantly block high-velocity botnets and basic card-testing scripts at the network edge at no extra cost. Then, you can route the remaining "human" traffic to Riskified for deep machine-learning analysis. Throughout this entire process, Hellgate Guardian ensures that raw PANs are vaulted safely, so Riskified only receives the safe, tokenized data required to make its decision, keeping your PCI scope minimized.

Internal Linking Strategy

1. Anchor Text: Hellgate Hub

   • Target: https://hellgate.io/hub (General Product Page)

   • Context: Directs readers to learn how the Hub orchestrates API calls between third-party fraud engines and acquiring banks.

2. Anchor Text: Hellgate Specter

   • Target: https://hellgate.io/specter (General Product Page)

   • Context: Links the concept of multi-layered fraud prevention to Hellgate's native edge-intelligence engine.

3. Anchor Text: Hellgate Guardian

   • Target: https://hellgate.io/guardian (General Product Page)

   • Context: Guides developers to understand how data is securely vaulted before being shared with external risk platforms.

Frequently Asked Questions (FAQ)

What is the difference between Riskified and 3D Secure (3DS)? 3D Secure (like Visa Secure) is an authentication protocol managed by the card networks that shifts liability to the issuing bank. Riskified is a private fraud management platform that shifts liability to Riskified itself. Merchants often use a payment orchestrator to combine both—using Riskified for frictionless approvals and stepping up risky transactions via 3DS.

Does Riskified prevent friendly fraud? Generally, no. Riskified's chargeback guarantee typically covers unauthorized fraud (e.g., a stolen credit card). It usually does not cover "friendly fraud" (first-party misuse) or service-related chargebacks, such as a customer claiming the item arrived damaged or was never delivered.

How does Riskified pricing work? While enterprise contracts vary, Riskified traditionally charges a percentage fee based only on the value of the orders they approve. This aligns their financial success directly with the merchant's revenue growth, rather than charging a flat API fee for every declined bot attack.

Layer your fraud defenses without the engineering friction.

Stop relying on rigid PSP filters that kill your conversion rates. Leverage Hellgate's Composable Payment Architecture to seamlessly integrate best-in-class fraud engines like Riskified, orchestrate your risk logic in real-time, and route approved volume with total freedom. Explore the Hellgate Developer Docs to see our fraud orchestration APIs, or visit Hellgate.io to book a technical demo today.