Casap Secures $8.5 Million in Funding to Revolutionize the Multi-Billion Dollar Payment Disputes Process and Fight First-Party Fraud

The AI-powered platform builds consumer loyalty while saving financial institutions millions in losses and resources.

NEW YORK, Oct. 28, 2024 /PRNewswire/ -- Casap, a disputes automation and fraud prevention platform, has raised $8.5 million to scale the first AI-powered solution for banks, credit unions and fintechs to intelligently tackle first-party fraud and automate disputes and chargebacks. The recent round was led by Lightspeed Venture Partners with participation from Primary Venture Partners, Commerce Ventures, Curql, Alloy Labs, and notable fintech founders and execs from Chime, Robinhood, Square, Current, Novo, and Alloy. The funding will enable Casap to continue to scale its AI decisioning, helping financial institutions reduce operational costs, curb fraud-related losses, and transform the consumer experience.

"The surge in first-party fraud and dispute volumes are overwhelming financial institutions," said Shanthi Shanmugam, co-founder and CEO of Casap. "Our platform helps banks, credit unions and fintechs meet these challenges head-on with intelligent automation that delivers fast, frictionless dispute resolution at a fraction of today's cost. By empowering institutions to identify fraudulent claims early and resolve legitimate cases swiftly, Casap is transforming what is often a frustrating customer service experience into an opportunity to build consumer loyalty."

Financial institutions are under immense pressure to resolve the 238 million chargebacks that emerge annually, most of which take 45-90 days to resolve. First-party fraud has consistently risen year over year since COVID, with more consumers disputing legitimate charges to avoid payment. This surge, combined with a growing tendency to file disputes directly with payment providers instead of merchants, has led to overwhelming volumes and substantial financial losses. Institutions are forced to hire large teams, navigate complex regulations, and outsource chargebacks yet still struggle to meet consumer expectations—50% of consumers will switch banks if they are not getting the service they want and expect, leading to long-term attrition and escalating costs.

Casap's AI-powered automations and proprietary "first-party fraud score", similar to an industry-standard FICO score, combine to resolve a dispute end-to-end without human intervention. The platform intelligently analyzes evidence, predicts outcomes, and automates key actions—such as issuing credits, filing chargebacks, and responding to merchants—while using its fraud score to identify suspicious consumers and merchants to proactively reduce disputes.

"Our team was impressed by the deep expertise Shanthi and Saisi brought to what is a cross-industry problem with significant scale. The company's early momentum is a promising indication of the type of compounding technological innovation we look for," says Aaron Frank, Partner at Lightspeed.

Casap's chargeback model, the first of its kind, includes publicly available weights—putting Casap at the forefront of innovation and sets a new standard for transparency in the industry. With built-in regulatory expertise and key integrations, Casap's advanced AI and decisioning capabilities cut resolution times from days to minutes, driving significant cost savings and enhancing operational efficiency for financial institutions.

Casap is already delivering measurable results for customers across the payments ecosystem, from major fintechs and established institutions like Chartway Credit Union to Banking-as-a-Service providers and sponsor banks.

"Before Casap, our team lacked the tools to effectively resolve disputes or file chargebacks, leading to a negative member experience and limited ability to improve the process," said Karin Collier, Director of Card Services at Chartway Credit Union. "Partnering with Casap has revolutionized how we think about disputes. With Casap's built-in regulatory expertise and AI-powered automation, we get to drive fast, accurate dispute outcomes, catch friendly fraud early, achieve higher NPS, all while seeing an immediate positive impact on our bottom line. Casap's customizability helps us adapt quickly to evolving needs, fraud trends, and transforms the way we work across the credit union. With Casap, AI is more than a tool—it's the engine driving our mission to create an unparalleled member experience. We're excited to continue partnering with Casap to transform how we operate across the back-office and set a new benchmark for exceptional member service."

"Choosing Casap as our multi-year partner for disputes and fraud management was an easy decision," continues Collier. "The partnership delivers immediate impact, with 29% cost savings from day one with even greater efficiencies projected just a month out. More importantly, Casap enables us to build trust by offering our members a fast, seamless self-service experience that sets a new standard for dispute resolution."

Casap is committed to making its platform the best-in-class solution for resolving disputes and chargebacks, helping customers achieve results up to four times faster than competitors in the space.

"Consumer trust is the lifeblood of financial institutions," Shanmugam continues. "Casap gives banks, credit unions and fintechs the tools they need to resolve genuine disputes quickly, while curbing the rising costs of fraud. We're not just solving a back-office problem—we're reshaping how institutions build trust and loyalty in the face of fraud."

Before founding Casap, Shanthi Shanmugam and Saisi Peter spent years driving innovation at fintech powerhouses Chime and Robinhood, with a focus on delivering seamless, consumer-first experiences. Their expertise in revolutionizing the way we operate payments has fueled Casap's rapid growth and early momentum.

Casap has also been recognized by industry leaders, winning the NACUSO 2024 Next Big Idea Competition.

About

Casap is an AI-powered disputes automation and fraud prevention platform. With built-in regulatory expertise and network integrations, Casap's intelligent automation identifies fraudulent claims early and delivers fast, frictionless dispute and chargeback resolution at a fraction of today's cost. Growing financial institutions use Casap to scale with a triple shield—back office efficiencies, fraud protection, and consumer delight. Casap is backed by top-tier VCs and notable fintech founders. Learn more at casaphq.com.

SOURCE Casap