Digital payment methods represent a global risk. The frequency of use of such technologies varies around the world, but there are general fraud tendencies. This suggests that criminals coordinate and communicate better than financial institutions do. So they have good cards Control mechanisms to infiltrate. Cross-border fraud is now ubiquitous. This emerges from the new study “The Escalation of Digital Fraud: Impacts of the Coronavirus on Global Fraud Challenges”, which was carried out by Javelin Strategy & Research together with SAS.
Payment methods: anti-fraud strategies fail
“In 2020 we see an increase in attempted fraud by almost 35 percent. This is an indication that criminals are increasingly focusing on the booming digital channels. You benefit from having strategies for Fight against fraud refer to normal buyer behavior – but in terms of payment transactions nothing is normal in 2020, ”reports a fraud management executive of a global card provider who was interviewed for the study.
Digital fraud is increasing – in frequency and in sophistication. Fraudsters and criminal networks are now using techniques that are just as advanced as the technologies used to counter them. Social engineering, phishing, identity schemes and the range of digital payment methods play into the hands of criminals. New methods in particular are a grateful goal, as these are usually not initially accompanied by sophisticated risk control mechanisms.
AI-based systems support the monitoring of attempted fraud
Financial institutions need a special technology layer and analytics for real-time threat detection. The complexity of the attacks requires the use of a separate technology layer in the IT infrastructure in order to identify and avoid attempted fraud in good time and to control strategies and investigations centrally at the same time. Automated measures and predictive case management, supported by AI and machine learning, can relieve employees of monitoring fraudulent activities and thus help to increase efficiency.
Data is essential. Data-based real-time analyzes and automated measures are the prerequisite for tracking down fraudsters in the “New Normal”. The extent to which companies are already able to do this depends on their technological maturity. What they have in common is the need for the most comprehensive real-time data in order to be able to make well-founded decisions. The implementation of cloud infrastructures is also an important factor in order to be able to process the required amount of data for the fraud management systems.
Digital payment methods are becoming increasingly popular
“The impact of this wave of fraud has taken on a whole new dimension – because of the rapid spread of digital payment methods around the world,” said Stu Bradley, vice president of the Fraud and Security Intelligence Division at SAS. “To solve the problem effectively, companies need a wide range of data and one hybrid multilayer approach. Because only on this basis can they make decisions – even beyond the pandemic. Advanced analytics is the common denominator that creates the agility needed to be prepared for the future, ”Bradley continues.
About the methodology of the study: For the study carried out by Javelin Strategy & Research “The Escalation of Digital Fraud: Impacts of the Coronavirus on Global Fraud Challenges“Payment and security decision-makers in 20 countries around the world were surveyed between January and September 2020. SAS is a solution provider in the field of analytics. Users use its innovative software and services to convert data into knowledge and to make intelligent business decisions. (sg)
Also read: What online retailers should consider when processing payments