FICO Survey: 1 in 3 Indians Fear Being Scammed as Real-Time Payment Risks Rise

Business Wire India(NYSE:FICO)

Strong points

  • Payment fraud top financial crime concern for 34% of Indians
  • Concerns about identity theft persist, with 37% of respondents believing they have been or could have been victims.
  • Real-time payment scams are on the rise, with 64% of respondents receiving fraudulent communications.
  • Fraud protection is paramount, with ease of use and good fraud protection being the main considerations when selecting financial service providers.

FICO, a leading global analytics software company, today unveiled its latest global consumer fraud study, highlighting Indians’ lingering apprehensions regarding real-time payments scams, in a context of increasing adoption of new convenient and fast payment channels. According to the study, the main concern of Indians remains the risk of being tricked into sending money to criminals (34%), which exposes individuals to instant and irrevocable losses, rarely eligible for reimbursement.

Additionally, concerns about identity theft persist, with 20% of Indians citing it as their top financial crime concern. This type of fraud carries additional risks beyond financial losses, such as compromised credit scores and the difficult process of restoring financial integrity.

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“Adoption of real-time payments in India continues to accelerate, with 98% of adults having made a real-time payment and 82% expecting to increase their usage over the next year. » said CK Leo, FICO’s head of fraud, security and financial crime in Asia Pacific. “As the adoption of real-time payments accelerates, driven by platforms like Paytm, Google Pay and PhonePe, we are witnessing a transformative shift in financial behavior. Yet, amid this rapid digitalization, there is an urgent need for increased vigilance against fraudsters lurking in the digital realm.

Real-time payment scams: a growing concern

As the incidence of scams continues to rise, research conducted by FICO last year revealed a worrying trend related to Authorized Push Payment (APP) and real-time payments fraud in India. Around 64% of Indians have received unsolicited text messages, emails, phone calls or other communications that they thought were part of a scam, while 57% of respondents said their friends or members of their family had been victims of fraud.

Surprisingly, 45% of respondents admitted to sending real-time payments for investments, goods or services that they never received. Additionally, 36% of those who made fraudulent payments through real-time payments lost up to INR 50,000, while 8% suffered losses of up to INR 6 lakhs. Despite these alarming figures, only 43% have reported actual or suspected losses to their bank.

“Banks now face a crucial time to invest in cutting-edge solutions to combat the rise of scams, particularly with the rapid adoption of real-time payments across the Asia-Pacific financial landscape. » Leo said. “The irrevocable nature of these transactions has given rise to new criminal threats. By integrating scam-specific analysis and scoring into transactions, along with strong decision-making capabilities throughout the customer journey, banks can preemptively detect and thwart fraudulent payments, saving customers from financial harm . Additionally, while some consumers may ignore warnings, the majority will heed the alerts and refrain from making real-time payments if alerted to potential scams. »

Identity theft awareness in India among the highest in Asia

Of concern, the rate of respondents reporting that their stolen identity had been used to open a financial account was significantly higher in India than in other countries surveyed. 13% of Indians said their identity had been stolen and used to open an account by a fraudster, while this was only reported by 5% of Filipinos and 3% of Indonesians. Considering India’s adult population, this 13% represents more than 165 million individuals.

However, despite widespread concerns about identity theft, there is still a dissonance between perception and reality among Indians. Around 33% believe it is unlikely they were victims, while 13% consider it possible and 23% are confident their identity remains intact.

“Even as some downplay the risk of identity theft in India, millions of people remain vulnerable. » added Leo. “This highlights the need for increased awareness and proactive measures. By breaking down silos and integrating identity verification and fraud detection processes, we can streamline applications and build trust in legitimate customers.

Indians prioritize good fraud protection

When asked about the most important considerations respondents have when choosing a new provider for a financial account, good fraud protection and ease of use are the two most important. These two elements were considered much more important than good customer service, strong anti-money laundering policies, sound green/environmental policies, ethical use of customer data, fair behavior and good reporting. price quality.

The survey was conducted in November 2023 by an independent research company adhering to research industry standards. 1,000 Indian adults were surveyed, along with approximately 12,000 other consumers in Canada, the United States, Brazil, Colombia, Mexico, the Philippines, Indonesia, Malaysia, Singapore, Thailand, the Kingdom -United and Spain.

FICO Survey: 1 in 3 Indians Fear Being Scammed as Real-Time Payment Risks Rise

FICO Survey: 1 in 3 Indians Fear Being Scammed as Real-Time Payment Risks Rise

FICO Survey: 1 in 3 Indians Fear Being Scammed as Real-Time Payment Risks Rise