Just under three quarters of Asia Pacific banks believe fraud cases in the region will increase ‘moderately or significantly’ during 2019, according to a study from FICO.
Two of the areas of particular concern to banks are transactions which are completed when a card or cardholder is not physically present (CNP fraud) as well as cards being taken out by criminals under false identities (application fraud).
FICO, a Silicon Valley-based predictive and analytics and data science company, surveyed 50 executives from financial institutions across the APAC region.
Of those to participate in the survey, 54 per cent said there would be a moderate rise in fraud in 2019 while 20 percent said there would be a significant jump. Furthering on from this, 40 per cent of respondents said identity theft remained as a key priority for banks.
From the study, it was found over 50 per cent of APAC banks continues to just block cards on the first fraud alert, a stat which has not changed since 2017. Only six per cent of the respondents stated the bank would keep the card open while trying to confirm fraud with the customer – this is double the per centage of last year’s study.
The survey also found that banks were measuring their fraud departments mainly by overall fraud losses, with 80 per cent stating this was their main way to measure fraud metrics. Following this was revenue, customer satisfaction and customer attrition which had 10, 6 and 4 per cent of responses, respectively.
FICO president in Asia Pacific Dan McConaghy said, “While protection against fraud is important, some banks are still struggling to balance prevention with customer convenience.
“Smart communications is one tool lenders can use to deliver a frictionless customer experience. Engaging customers with an automated SMS or call to check if a transaction is genuine, while they are still at the register, engages them in the protection of their account and can have a positive influence on their impression of the bank.”
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