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CSEET · Economic and Business Environment · AI and Business Environment

A bank in Mumbai deploys an AI model that scans card transactions in real time and flags unusual patterns, such as sudden high-value spending in a distant city, for review. Which feature of AI makes this application effective?

Pattern recognition and anomaly detection on large data make it effective. The model learns what normal card behaviour looks like and flags deviations instantly across millions of transactions, something fixed rules, manual checks or random sampling cannot do at the same speed or scale.

  1. APattern recognition and anomaly detection on large dataCorrect
  2. BFixed rules that never change with new data
  3. CManual checking of each transaction by staff
  4. DRandom selection of transactions for review

Explanation

Fraud detection relies on models that learn normal behaviour from large data and spot deviations as they occur. Fixed unchanging rules, manual review and random selection lack the learning and real-time scale that make the AI approach effective.

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