GBG and Chartis Research Collaboration: Heightened Risks of Fraud in Asia and Innovative Technological Solutions
In Brief
In a joint effort, GBG and Chartis Research released insightful findings that delve into the challenges and advancements in the realm of fraud detection and prevention throughout Asia.
A firm specializing in identity verification, location intelligence, and fraud mitigation strategies, GBG released a new report titled “ Cultivating Trust in Digital Platforms: An Examination of Banking and Finance Trends Across Asia .” Produced in partnership with Chartis Research , the research investigates the obstacles and progress made in tackling fraud detection and prevention, especially in light of the region's rapid digital technology adoption.
One significant revelation from the report is that 80% of financial institutions in Asia are currently struggling with the detection of digital fraud. Despite this, these institutions are actively engaging in technological enhancements to improve user experiences, aiming to mitigate risks and sustain customer trust.
Furthermore, the company has flagged a concerning trend regarding the escalating intricacy and frequency of fraudulent activities. Close to 90% of survey participants recognized the development of sophisticated tactics as a critical hurdle in effectively identifying fraud. Notably, phishing scams have surged, with 59% of respondents reporting an uptick, along with a 57% increase in similar fraudulent activities.
Regarding the balance between security and customer experience, an overwhelming 97% of those surveyed acknowledged it as a significant challenge. This aligns with the increased pace of digital adoption in Asia, where real-time transactions are now the norm, thus amplifying the fraud risk for both financial institutions and consumers. Therefore, it’s essential that these organizations deploy robust security protocols while still delivering a seamless customer experience to uphold trust.
GBG Shows That Proactive Investment in Technology is Essential
The report also highlights that effectively identifying new and intricate types of fraud requires a comprehensive approach that fuses traditional anomaly detection methods with cutting-edge technologies such as neural networks. However, the integration of additional data into existing fraud detection systems is hindered by outdated technology, with 64% of respondents citing this as a significant contributor to elevated false positive rates. This issue is exacerbated by the widespread concern over data quality, acknowledged by more than half of the respondents.
Moreover, the study revealed that while Asian banks and financial institutions have historically relied on hiring personnel to fill gaps in fraud detection, there is a clear move towards increasing investments in machine learning (ML) and artificial intelligence (AI) in the upcoming years. The investment in these technologies is forecasted to surge from 16% in 2023-24 to a staggering 68% by 2025-26. This indicates a pivot from traditional detection methodologies to automated systems designed to handle more complex challenges. The goal is to alleviate the burden on personnel and reduce operational costs while optimizing fraud detection processes.
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