What is digital banking fraud?
Digital banking fraud is a type of online fraud that targets customers’ mobile or online bank accounts. Fraudsters gain unauthorized access to consumers’ accounts, steal their personal information, and perform fraudulent transactions. Common examples of digital banking fraud can occur through attacks like phishing, include social engineering attacks, phishing, authorized push payment (APP) scams, and SIM-swap fraud.
How does digital banking fraud evolve?
As new banking technology like instant payments are introduced, fraudsters take advantage of the latest innovation to create new opportunities for fraud. For example, the rise in popularity of real-time payment (RTP) tools has resulted in the subsequent rise of RTP fraud. In addition, fraudsters are delivering more sophisticated attacks, often involving multiple vectors in a single attack. For financial institutions (FIs), it can prove difficult to keep up with evolving digital banking fraud threats.
Which banking stages are most susceptible to digital banking fraud?
The key stages where banks should keep an eye out for suspicious activity are while onboarding a new customer, during card-not-present (CNP) payments, and when customers log in to their accounts. To protect consumers, banks need strong cybersecurity measures that include modern authentication tools, such as biometric authentication. FIs that rely on outdated authentication tools, such as passwords, expose their customers to the risk of digital banking fraud as fraudsters today can hack simple or commonly used passwords in a matter of seconds. What's more, fraudsters can now access fraud-as-a-service to get their criminal activities off the ground even faster!
Additional ways FIs can reduce digital banking fraud
Another way FIs can fight against digital banking fraud is by collaborating with other banks, credit unions, and industry stakeholders. Educating customers about fraud trends and what to look out for is another key measure FIs can put in place to reduce digital banking fraud.
Example:
A customer reuses the same password across all their digital accounts. Once a fraudster obtains this password, they will try – and succeed – to hack into their victim’s bank account, change the email address connected to the account, and then transfer all the money to a fraudulent account.
Further reading:
Keywords:
Digital banking fraud | Authentication tools | Cybersecurity
Digital banking fraud is a type of online fraud that targets customers’ mobile or online bank accounts. Fraudsters gain unauthorized access to consumers’ accounts, steal their personal information, and perform fraudulent transactions. Common examples of digital banking fraud can occur through attacks like phishing, include social engineering attacks, phishing, authorized push payment (APP) scams, and SIM-swap fraud.
How does digital banking fraud evolve?
As new banking technology like instant payments are introduced, fraudsters take advantage of the latest innovation to create new opportunities for fraud. For example, the rise in popularity of real-time payment (RTP) tools has resulted in the subsequent rise of RTP fraud. In addition, fraudsters are delivering more sophisticated attacks, often involving multiple vectors in a single attack. For financial institutions (FIs), it can prove difficult to keep up with evolving digital banking fraud threats.
Which banking stages are most susceptible to digital banking fraud?
The key stages where banks should keep an eye out for suspicious activity are while onboarding a new customer, during card-not-present (CNP) payments, and when customers log in to their accounts. To protect consumers, banks need strong cybersecurity measures that include modern authentication tools, such as biometric authentication. FIs that rely on outdated authentication tools, such as passwords, expose their customers to the risk of digital banking fraud as fraudsters today can hack simple or commonly used passwords in a matter of seconds. What's more, fraudsters can now access fraud-as-a-service to get their criminal activities off the ground even faster!
Additional ways FIs can reduce digital banking fraud
Another way FIs can fight against digital banking fraud is by collaborating with other banks, credit unions, and industry stakeholders. Educating customers about fraud trends and what to look out for is another key measure FIs can put in place to reduce digital banking fraud.
Example:
A customer reuses the same password across all their digital accounts. Once a fraudster obtains this password, they will try – and succeed – to hack into their victim’s bank account, change the email address connected to the account, and then transfer all the money to a fraudulent account.
Further reading:
- Case study: Protect customers from SIM-swap fraud and help them transact securely.
- Blog: How to reduce digital banking and payment fraud in 5 steps.
Keywords:
Digital banking fraud | Authentication tools | Cybersecurity
