Key Strategies for financial institutions to combat fraud

The fraud landscape is evolving rapidly, driven by rising cyber-attacks, advancements in artificial intelligence, and increasingly sophisticated scams. In fact, our latest Experian UK Fraud and Fincrime Report 2024 shows that in 2023, fraud volumes surged by 9.3% in the UK, with third-party fraud being the most prevalent. Over half of businesses also reported increased fraud losses, and seven out of ten businesses anticipate their fraud management budgets will grow.

This situation underscores the relentless pressure on fraud teams within businesses and highlights the urgent need for robust fraud prevention strategies. A proactive and adaptive approach to fighting fraud is essential. So, what can businesses do to stay ahead in this challenging environment?

1. Adapting strategies to increased digital adoption by consumers

Recent Experian research highlights that digital transformation is accelerating at an unprecedented pace, with mobile wallet usage surging from 54% to 77%, retail app usage climbing from 36% to 76%, and over 80% of shoppers now using peer-to-peer payment apps. However, despite this shift towards digital convenience, concerns about online fraud remain significant. Identity theft, phishing scams, and stolen credit card information are among the top worries. Alarmingly, 66% of respondents are now concerned about identity theft, up from 58% in 2022.

To address these concerns, businesses should enhance security measures with multi-factor authentication, encryption, and regular audits. Educating consumers on recognizing and avoiding common fraud tactics…