Practical Credit Card Fraud Detection: Machine Learning Solutions for Imbalanced Datasets and Comparison Between XGBoost/LightGBM Models

This article introduces an end-to-end machine learning project for credit card fraud detection. It uses SMOTE sampling technique to address data imbalance issues, compares XGBoost and LightGBM models, and ultimately achieves an AUPRC score of 0.8815. The project covers the entire workflow including feature engineering, model training, and evaluation, providing a reference for similar problems.

The core challenge of credit card fraud detection lies in the extreme data imbalance (fraudulent transactions account for an extremely low proportion). Traditional models tend to favor the majority class, resulting in high accuracy but no practical value. Therefore, the project selects AUPRC as the main evaluation metric, which is more suitable for imbalanced scenarios.

In terms of feature engineering, time features are creatively processed into cyclic features (sine/cosine components) to capture periodicity; SMOTE is used to synthesize minority class samples (not simple replication, maintaining local structure), and it is only applied to the training set to ensure the authenticity of evaluation.

Comparing the two gradient boosting models: XGBoost achieves an AUPRC of 0.8815 and a recall rate of 86%; LightGBM trains faster and has a precision rate of 93% (fewer false positives). GridSearchCV is used for parameter tuning to ensure optimal configuration.

AUPRC is used as the main metric (more sensitive to minority classes). From a business perspective, an 86% recall rate significantly reduces fraud losses, and a 93% precision rate reduces customer distress caused by false alarms; actual deployment requires a trade-off between recall and precision.

The project demonstrates a complete data science workflow, and its code organization (Notebook + scripts + dependency management) is worth learning from; it is an excellent introductory reference for learners. In the future, model interpretability can be explored to support business decisions.