Only AI can fight AI, says PayPal Australia general manager Andrew Toon

The battle to keep online businesses secure has already moved beyond human scale, with PayPal Australia’s general manager Andrew Toon telling The Australian that only AI can fight AI.

PayPal has found that hackers are using AI to replicate human behaviour. Picture: AFP

Fighting AI with AI is the only way to combat cyber crime and online fraud, PayPal Australia general manager Andrew Toon says.

The warning comes as PayPal’s latest Australia eCommerce Index revealed less than half of Australian businesses had adopted AI platforms to enhance their online shopping offerings.

This is despite tech giants ­including Google and Microsoft introducing a raft of new AI-powered products to make e-commerce easier. But PayPal’s survey, based on a survey of more than 1000 consumers and 400 businesses, underscores the trepidation most Australians are feeling towards AI.

Mr Toon understood ­concerns many businesses felt, particularly regarding the technology’s capacity to ramp up the scale and volume of cyber attacks. But he said artificial intelligence risk management tools were the keys to fighting fraud and online crime. “There are some concerns but you need to counter that with AI-enabled risk-prevention solutions,” Mr Toon said.

“If you think about the stuff that we see across our business, where we process 58 million transactions a day, and when a customer completes a transaction on PayPal’s platform, there are some hundreds of different ­measures using all these AI ­models … to assess risk and fraud.

“That allows us to conduct thousands of risk checks within a second and this has really helped us to manage fraudulent transactions, compromised accounts, and it’s all happening in real time. And AI and machine learning is definitely able to make us really, really make sure that our platform has the security and interest element that everybody expects of us.”

The PayPal survey revealed about 34 per cent of businesses were concerned that artificial intelligence would spark even more sophisticated cyber attacks, following high-profile assaults on Optus, Medibank and Latitude Financial in the past 12 months.

Mr Toon said hackers could use AI to create programs that mimicked known human behaviours, highlighting the need to fight AI with AI.

PayPal Australia general manager Andrew Toon.

“Those hackers can then use these programs to trick people into giving up their personal or ­financial information and potentially bypass traditional, rule-based fraud checks that businesses might have in place,” he said.

“The best way businesses can hope to counter AI cybercrime is with an AI-enabled risk prevention solution. PayPal has leveraged AI for over a decade to ­protect consumers, manage risks and complete advanced fraud ­detection which has led to tremendous impact.

“From 2019 to 2022, at a time when PayPal’s global payment volumes nearly doubled from $US712bn to $US1.36 trillion, the company cut its loss rate by nearly half, thanks to technology advances including AI algorithms.”

Shoppers are also approaching AI with caution. PayPal’s study found that 43 per cent of consumers wanted to use AI to help them shop online, while 47 per cent were concerned that deep fakes will be used for fraud

This despite Google launching various AI products to help people shop online, including the ability to try on a garment virtually or take a photo of an item you like, such as a pair of shoes, and find it available to buy on the ­internet. Microsoft has also launched similar products.

But Mr Toon said the uptake of AI-powered online shopping tools was greater among younger consumers, with 63 per cent of those aged 18-26 keen to use the technology, highlighting how ubiquitous it will be in the future. “They’re seemingly quite open minded in terms of how they can use AI,” he said.

“And then beyond, thinking about sort of the e-commerce environment online shopping, there are elements like meal planning and drafting work-related documents, their emails and surveys and creating workout plans, online to tutorials, and also personal documents, greeting cards and wedding speeches. It’s mixed.

“It’s been a testament to AI and it puts us in a great position to continue to look at ways that we can support our consumers and our businesses in this space. That’s for sure.”

While most businesses are yet to embrace AI for online shopping, Mr Toon said 43 per cent say they would like to, showing the “appetite for adopting these emerging technologies to drive efficiencies and deliver improved customer experiences”.

He said the top six uses for AI among Australian online retailers were: writing web content; creating visual design elements, managing returns, exchanges or updates to consumers on delivery status; responding to social media comments or messages; and detecting fake or auto-generated comments and reviews.