4 Trends for Fintech to Combat Fraud

• Scams: While credit card fraud is the most costly fraud, scams are a close second, cited by 15% of respondents.
• False Positives: 56% of fintech report that 10-50% of their fraud alerts are nothing more than false alarms.
• Operational Efficiency: 35% that are dependent on engineering to write and deploy rules wait over a month for rule deployments
• Real-Time Monitoring: 96% who have implemented Real-Time Monitoring over a year ago testify to improvements in fraud detection
• AML Burden: 48% report an increase in SAR filings YoY with 13% experiencing a significant increase

Fraud continues to plague the financial services industry, and fintechs are no exception. Payments are moving faster than ever, and fraudsters constantly evolve their tactics. Fintechs are seeing a surge in scam activity and are facing constraints due to the burden of AML. Many are seeing large false positive rates and bottlenecks when deploying new rules. Some use Real-Time Monitoring (RTM) to combat operational inefficiency and catch fraud, while others combine fraud and AML teams to help.

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Despite all this, Fintech is still seeing large fraud losses, with more than a quarter of respondents stating losses above $1 million.‍

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In this report, we examine survey results from 215 fintechs and uncover what is holding them back. We also discuss how agility and speed must play a critical role in combating fraud in the years to come.