As financial crimes grow in complexity and sophistication, payment firms find themselves at the forefront of the battle to safeguard their operations and consumer trust. The industry is now confronting emergent threats driven by technological advancements, such as AI-generated fraud and social media exploitation, amidst challenging economic conditions. 

In 2023, the most prevalent types of fraud included identity fraud, facility takeovers, and misuse of facilities, reflecting the persistent and evolving nature of these threats. 

The Financial Crime 360 State of the Industry Survey 2024, which involved participants from 32 countries, provides critical insights into the payments industry. Key findings reveal that fraud remains the foremost concern, with identity fraud being the most common type encountered.

The survey also highlights the growing investment in technologies such as AI and machine learning for fraud prevention, as well as the importance of industry collaboration and regulatory updates. These insights are crucial for payment firms aiming to develop proactive strategies to stay ahead in this dynamic and demanding environment.

Key findings cover: 

• Top Challenges in Financial Crime
  • Fraud remains the foremost financial crime concern (64.90%), followed by cybercrime (51.66%) and AI-enabled fraud (38.41%). 

 

• Prevalent Fraud Types
  • Identity fraud is the most common type, reported by 41.72% of respondents. 

 

• Emerging Fraud Trends
  • Authorised Push Payment (APP) fraud (26.49%) and identity fraud (16.56%) are leading concerns. 

 

• Technological Investments
  • Companies are prioritising investments in machine learning and AI (58.94%), digital identification verification (45.70%), and automation processes (44.37%). 

 

• Fraud Prevention and Management
  • A majority are employing strong AML/CTL programmes (58.94%) and transaction monitoring systems, both rules-based (58.28%) and machine learning programmes (49.01%). 

 

• Spending Trends
  • Nearly half (47.68%) reported spending between £50,000 and £500,000 on financial crime-related initiatives in 2023. 

 

• Industry Collaboration and Updates
  • Companies stay updated through industry reports (81.46%), conferences (70.86%), and industry media (68.21%). 

 

• Regulatory Environment
  • Opinions are divided on the fitness of the UK’s fraud regulation, with 50.99% considering it fit for purpose, while 49.01% believe updates are needed to address the evolving threat. 

Gain access to the full infographic report here.  

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Excerpts of this report have been republished with permission by The Payments Association. 

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Payments Consulting Network is a media partner of Financial Crime 360. 

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