Faced with heightened digital disruption and growing sophisticated fraud typologies, financial institutions across APAC rethink how to future-proof fraud prevention
SINGAPORE - Media OutReach - 15 October 2020 - GBG (AIM:GBG), theglobal technology specialist in fraud and compliance management, identityverification and location data intelligence, has today launched its inauguralreport across APAC, titled "Future-proofingFraud Prevention in Digital Channels: APAC FI Study", which analysesthe impact of fraud on financial institutions (FIs) across six countries andthe technologies they are planning to invest in to mitigate today's fraudthreats and scale to address emerging fraud patterns.
The report found FIs in APAC projecting an averageestimated budget of USD83.3 million to purchase new fraud prevention technologyin 2020-2021. The three countries with the highest average estimated fraudbudgets are Thailand at USD95.4 million, China at USD91.4 million and Indonesiaat USD88.9 million.
The research unveils trends and priorities of APAC FIsin the digital age, key fraud and risk management challenges in digitalisation,and technology investment plans to enable fraud insulated digital products andchannels.
According to the report, instant gratification forfinance and banking services is seeing greater demand and rollout by financialinstitutions in APAC, with 31% of FIs planning for instant bank accountapplications and instant loans, and 29% of FIs planning rollouts of instantcredit cards. Furthermore, financial products like e-wallets are becoming ahygiene factor for 90% of financial institutions as they look to expand theirdigital channels and deliver superior customer experiences.
As FIs vie for digital confidence with their targetconsumers, 66% of respondents cited end to end fraud management platformreadiness as a key differentiation to driving preference. However, only 6% havean existing implementation of an integrated end to end fraud and complianceplatform solution, and vertical silos are still seen in 43% of APAC financial institutionsand are most prevalent in digital banks. Upgrading to fraud management platformsolutions is also a work in progress for 57% of FIs and almost 50% have plannedinvestment to upgrade their digital onboarding fraud solutions.
The interest in new segments beyond the traditionalwhite- and blue-collared workforce is also apparent. The unbanked segment haspivoted to be a mainstream focus as fraud technology advances, with almost athird of respondents planning to access the unbanked (32%) and underbanked(31%).
June Lee, APACManaging Director of GBG commented, "Lookingat 2020-2021, the COVID-19 pandemic will continue to push people and businessesto take digital-first approaches to financial transactions. From our research,e-wallet, instant financial services, mobile and app banking are goingmainstream rapidly, which make it urgent for FIs to take innovative andproactive measures to future-proof against escalating digital financial crimes.The pandemic is creating a lot of uncertainty, but the majority of FIs in APACrecognise that an end to end fraud management platform is strategic todifferentiating themselves from the highly disruptive landscape they areplaying in and would be a springboard to scale fraud prevention and securingdigital trust with customers."
FinancialCrimes 4.0, a term coined by GBG, is a mega risk trend covering theheightened complexity and growing volume of emerging financial crime arising fromthe state of hyperconnectivity and data deluge in today's Industry 4.0. Thisincludes the boom in digitally connected devices, internet of things (IOT), andonline social sharing, where these rapid changes have opened new access pointsand vulnerabilities that are being harnessed by sophisticated, malicious actorswith speed and scale.
Respondents recognised all fraud typologies are on therise, with social engineering crimes, in particular to scams, having a higherprojection. Respondents believe that they require stronger endpoint threatprevention solutions to work across the onboarding and transaction customerjourney. The need for enhanced data intelligence to obtain a better 360 view ofa customer is also seeing an uptick with more than 50% of the respondentsplanning to invest in the ability to ingest new data in 2020-21.
Chee Leong Chin, APAC Chief TechnologyOfficer of GBG, added, "The proliferation of personally identifiableinformation (PII) is making consumers increasingly vulnerable and susceptibleto fraud and identity crimes. Meanwhile, customer expectations around instant accessto an increased variety of digital financial services and digital safety assurancein transacting online are also skyrocketing. GBG continues to innovate and beahead of market needs with its tech stack ranging from end to end fraudplatforms, to pre-emptive fraud detection like machine learning and dataintelligence from best in class players across identity proofing, mobile and IPassessment, cyber threats, credit risk and location intelligence."
GBG collaborated with The Asian Banker to survey 324financial institutions in six key Asia-Pacific markets including Australia,China, Indonesia, Malaysia, Thailand and Vietnam.
For more insights into the research, please join GBG's "Future-proofingFraud Prevention for Digital Channels: APAC FI Study" webinar on 21 October.
To access theseries of Future-proofing Fraud Prevention in Digital Channels reports, visit:
- Indonesia Financial Institution Study
- Malaysia Financial Institution Study
- Australia Financial Institution Study
- APAC Financial Institution Study
GBG offers a rangeof solutions that help organisations quickly validate and verify the identityand location of their customers.
Our market-leadingtechnology, data and expertise help our customers improve digital access,deliver a seamless experience and establish trust so that they can transactquickly, safely and securely with their customers online.
Headquartered in theUK and with over 1,000 team members across 16 countries, we work with 20,000customers in over 70 countries. Some of the world's best-known businesses relyon GBG to provide digital services and keep the economy moving, from USe-commerce giants to Asia's biggest banks and European household brands.
To find out more about how we help our clientsestablish trust with their customers, visit www.gbgplc.com/apac, follow us on Twitter@gbgplc or