Digital transformation has accelerated momentum around real-time, cross border payments and digital wallets.

In 2021, GlobalData assessed that 118.3 billion real-time transactions were made globally with a forecast of 427.7 billion expected by 2026, equal to a quarter of all global digital payments.

While a prime-time for our digital economy, ACI Worldwide reports a surge in the number of hacking schemes targeting digital wallet users, with 10% of UK adults reportedly falling victim to this form of fraud.

Digital wallets have increased capability to store funds, financial information and allow the user to make transactions and track payment transfers on most devices.

The rollout of digital wallets, which the European Commission is in the process of currently approving, promises faster and more efficient payment methods for businesses and consumers alike. The Commission set out in 2021 to deliver a trusted and secure digital identity for Europeans citizens. Payments are also becoming increasingly connected with fin-tech apps.

Cases of digital wallet fraud through digital account hacking, social engineering techniques and identity theft have also affected 13% of people in France, 11.7% of Italy’s population, and a 41% of India’s population.

UK Finance, the association of banking and finance enterprises, closely follows the rising trends in financial crime infiltrating the sector and recently uncovered £1.3 billion losses to online fraud in 2021. The association regularly reports on the shifts in criminals changing their focuses to exploit weaknesses in customers’ accounts.

One of the tactics criminals will deploy to trick and defraud the consumer into making an authorities payment to a criminal account is termed authorised push payment (APP) fraud. Social manipulation tactics are common with this type of financial crime to elicit the consumer’s personal information and passwords, whereby criminals will try a range of approaches including phone calls, text messages and emails.

Across the Finance sector, consumers are reminded to be vigilant of fraud and payment scams but Cleber Martins, Head of Payments Intelligence and Risk Solutions at ACI Worldwide comments: “Banks need to wake up to the fact that, while they need to use their most advanced technology to monitor outgoing transactions, the same needs to be done for incoming payments to detect mule and fraudulent accounts,” said Cleber Martins, head of payments intelligence and risk solutions, ACI Worldwide.

“We must see increased accountability at the receiving end and enhanced data sharing among all participants in the ecosystem – without breaching privacy regulations. As fraudsters are becoming more advanced, a detailed and holistic view of all payments activity is essential to containing them,” he added.