Latest Security reports and research: Finextra Research

Impact Study

2024 Fraud Trends in Banking, Insurance, and Beyond

How generative AI is boosting fraud protection in an increasingly complex environment. As technology progresses, so do the capabilities of institutions to secure data and systems. Over 2024, the fraud landscape has been complex, and organisations must push the boundaries of innovation while maintaining a high security bar as the availability and democratisation of AI increases as we're going into 2025. The tidal wave of incoming regulation in the financial sector is an aspect that will help banking and insurance companies to safeguard their customers and data in the best way possible. Yet regulation alone does not address fraud – it’s up to individual organisations to leverage the potential of technology, and review their solutions, processes, and thus ensure compliance and safety. As fraud and regulation increase in the space, technology is one of the key factors that will help banks and insurance companies to address these increased fraud risks. Generative AI enables organisations to deliver hyper-personalised customer experiences, and combining these capabilities with carrier network insights can not only help them significantly reduce authentication fraud, but also ensure regulatory compliance. This impact study, produced in association with AWS and Vonage, examines the current fraud landscape across financial services, banking, and insurance, highlighting how generative AI and network APIs can help prevent fraud while enhancing the customer experience. Explore: Fraud trends in 2024 The impact of regulation Why data is the new gold How organisations can innovate with generative AI Best practices

31 October 2024 202 downloads

Future of Report

The Future of Embedded Finance in Africa 2025

Embedded finance is changing the payment landscape in Africa. The question now is: what will it take for embedded finance to truly scale across Africa? The global embedded finance market is set to grow beyond $228 billion by 2028 according to Juniper Research. As this market matures and consumer confidence in the technology grows, this will likely prove to be a significant chunk of global financial services. In Africa, this emerging trend has the potential to unlock new economic opportunities. As a less mature market, it is not as hindered by legacy payments systems, making it ripe for payment innovation from embedded finance. It has the potential to reshape the continent’s current payments landscape, broaden innovation opportunities, and drive financial inclusion. As a market Africa is very adaptable to different technologies, and embracing of newer, more agile services. A lot of the population to the majority of their banking through their mobile phones, making embedded finance fit seamlessly into financial worlds of the populace. Yet there are many factors which will alter and develop the ability for embedded finance to take hold. This Finextra report, sponsored by Kora, received contributions from Binance, Indelible Inc., Mojaloop Foundation, and Nikulipe. It explores: Making embedded cross-border payments work in Africa; Unlocking the opportunities of embedded e-commerce in the African market; Embedded finance: Encouraging African financial inclusion; Why personalisation in embedded finance is the next step for African fintech; Regulating Africa to encourage embedded finance innovation.

10 October 2024 261 downloads

Impact Study

Adding GenAI To Your Fraud Prevention Strategy

We explore the numerous benefits of generative AI for fighting fraud. In an instant payment, cross-border world, fraud is more nefarious and prevalent than ever. Recent research shows that worldwide, APP (Authorised Push Payment) fraud now represents 75% of all digital banking fraud on a dollar-value basis. By 2026, losses are expected to reach $5.25 billion – revealing that APP fraud is one of the biggest threats to financial institutions (FIs) globally. The next pre-emptive step in the fight against fraud is generative AI (GenAI), which uses Large Language Models (LLMs) to generate new content like text, audio, video and even new computer code. While GenAI is still in the fledgling stages of adoption within fraud prevention, it will soon become a true differentiator. But how exactly are scammers deploying AI to their advantage? What are the best ways to incorporate GenAI into a fraud prevention strategy? How should consumer privacy be managed? This impact study answers these questions and casts an eye over the current fraud landscape, the regulatory implications, and the vital role of innovation. This Finextra impact study, produced in association with Outseer, explores: The evolution of scams; The role of AI; Technology and the impact of generative AI; How to embed AI in the best way possible; Addressing regulatory challenges and concerns; And more.

27 September 2024 393 downloads

Survey

The Global Fight Against Trade-Based Financial Crime

Broken inside, broken outside: Uncovering the internal weaknesses and external pressures fuelling a $1.6 trillion challenge. Trade-Based Financial Crime (TBFC) is a global issue, draining $1.6 trillion annually from economies—funds that could otherwise fuel development, build infrastructure, and stabilise financial systems. Instead, these resources are diverted into criminal networks that operate across borders, exploiting the very institutions meant to protect global finance. This is a crisis that goes beyond numbers; it strikes at the core of trust and stability in the financial world. This global survey, conducted in the summer of 2024, revealed the alarming extent to which financial institutions remain unprepared in the face of the growing threat of TBFC and sheds light on the significant challenges, technology gaps, and fragmented risk management strategies that enable significant financial crime. Input from leaders at ING and ITFA reinforces the critical role of technology in combating TBFC, while also acknowledging the operational challenges that remain. Implementing AI-driven solutions at scale is proving to be a significant obstacle for many institutions, with the timeline for action growing ever tighter. Download this Finextra survey, produced in association with Eastnets, to explore: Why TBFC is a growing global crisis What internal roadblocks institutions are facing An investigation into the external challenges of combatting TBFC Recommendations for what risk leaders should do next And more Click here to join us for the Finextra webinar, Global Trade Based Financial Crime: Where Trade and Payments Meet, and hear from our panel of industry experts discuss the finding from this survey and the current state of trade-based financial crime globally.

25 September 2024 287 downloads

Impact Study

Microservices Architecture: Future-Proofing Payments Technology

It is high time for banks to move away from legacy thinking and embrace modernisation to remain competitive in the industry. Financial institutions have long been threatened by innovative, tech-savvy fintech firms that do not have to maintain decades-old back-office systems. Core banking systems within banks have evolved, but with additional pressure from incoming regulation and subsequent reporting, progression and modernisation has not kept pace with industry developments. In the US alone, the real-time payments market is expected to grow at a compound annual growth rate of 31% until 2030. An institution’s success in scaling their payment processing in response to this shift will rest heavily on how their systems are set up. Cloud-native payments processing is the most viable option to keep pace with innovation demand and competition; enabling banks to build upon flexibility, at low cost and risk. These enablers also make cloud infrastructure – both public and private – attractive for banks that have struggled to streamline, maintain and upgrade their legacy infrastructures. This Finextra research paper, produced in association with Diebold Nixdorf, explores the opportunities of microservices architecture. It discusses: Then & Now: Monolithic vs. microservices architecture Overcoming microservice challenges The benefits of a micro-approach Real-world examples and cases studies And more. Click here to join the Finextra webinar, hosted in association with Diebold Nixdorf, to watch as our panel of iindustry experts explore the benefits of microservices architecture, and what needs to be done to ensure migrations are streamlined.

27 August 2024 407 downloads

Impact Study

Payment Fraud in 2024: Who is Liable?

Fraud is a billion-dollar business in the Instant Payments era. Statistics show that ecommerce fraud is predicted to exceed $48 billion globally by the end of 2023 alone and could exceed $362 billion between 2023 and 2028. In 2024, banks will not only contend with the changing liability landscape, but the upcoming adoption of ISO 20022 as well. Both represent a historical shift in the financial services industry. To prepare for a higher degree of liability in a data-rich environment, banks need to address the holistic landscape of fraud mitigation. This Finextra impact study, produced in association with NICE Actimize, addresses the changing liability landscape and what banks need to do to prepare for regulatory changes and increased fraud protection. We cover: Shifting liability and the impact of new PSR regulation ISO 20022’s impact on the financial industry Financial industry priorities in 2024 And more.

08 July 2024 630 downloads

Impact Study

Fraud and AML Case Management: How to Operate at the Speed of Risk

The digital revolution has fuelled a surge in transactions, while economic turmoil, geopolitical tensions and shifting regulations have emboldened sophisticated financial criminals. As a result, fraud is costing financial institutions more than ever before. Traditional siloed systems and manual process have left financial institutions vulnerable by drowning investigators and analysts in data, while starving them of actionable insights to stay ahead of risk. This Finextra impact study, produced in association with NICE Actimize, explore how institutions can bolster their fraud management and anti-money laundering (AML) prevention systems to stay ahead of risk, reduce operational costs and investigations time, and meet changing business and regulatory requirements. We cover: How to resolve siloed case management How to fix fractured data How to create a faster, more intelligent workflow And more.

16 May 2024 389 downloads

Survey

Definitive Differentiators - Forging a future-proof payments model

Over the last few decades, banks have been forced to reconsider their business model for transaction services. During the era of low-interest rates, the focus shifted to transaction revenues, and while the pendulum is now pivoting back to utilising the balance sheet for revenue growth, the amount of new regulations impacting the industry is ever-increasing. New technology and market regulation have fostered innovation and new market entrants. This “perfect storm” is exposing a number of potential threats for banks, but also new opportunities to expand the share of customer wallet and time to market, and drive cost efficiency through standardization. This Finextra survey report, produced in collaboration with Tietoevry, explores the key factors driving changes to payment models for different financial institutions and how they can wield continued or differentiated success in the evolving landscape.

18 March 2024 594 downloads

Impact Study

APP Fraud Liability: A Guide for Banks

Fraud is running rampant. The UK Government's 2023 'Fraud Strategy' report highlighted that fraud now accounts for over 40% of crime, yet receives less than 1% of police resources. More needs to be done to ensure that the consumer is protected. This is why, as per the Financial Services and Markets Bill, all PSPs will now be required to reimburse fraud victims from October 2024. In light of these upcoming changes, banks need to reassess how they manage liability associated with APP fraud and develop new methodologies in order to investigate and mitigate fraud more effectively. This Finextra impact study, produced in collaboration with Form3, gives banks a guide to tackling the new APP fraud liability landscape. It highlights: Risk scoring payments Implementing the right intelligence Considering false positives Ensuring explainability And more.

06 March 2024 560 downloads

Impact Study

8 Steps to Efficient Transaction Fraud Monitoring

In the wake of the widespread shift to digital banking and ecommerce, fraud teams have seen a sharp increase in card transaction fraud. Since 2014, card transaction fraud has increased by an average of 8.9% per year and exceeded $32 billion in losses in 2021 alone. In an increasingly complex threat environment, card transaction fraud has devastating consequences for banks and merchants alike. Technologies like cloud, artificial intelligence (AI) and machine learning (ML) pave the way for innovative fraud solutions. Yet, in order to effectively deploy these tools, banks need to address their underlying risk strategies, technical infrastructure and the quality of their available data. This Finextra impact study, produced in association with Brighterion, a Mastercard company, explores the eight steps for banks to reach transaction fraud monitoring excellence. Download today to learn more.

08 February 2024 537 downloads

Sentiment Paper

Payments: The key to unlocking new ecosystems and why merchant services are on the up

To say things have changed in payments, and, as a result, the merchants services space is to understate a dramatic and fast-moving digital and cultural evolution that has driven such change. Digital payments have enabled the establishment of hundreds of merchant businesses, particularly in developing markets, as well as the significant growth of global ecommerce. This Finextra Research report, in association with Ingenico, explores: How banks and acquirers have adapted to the digital frontier; The importance of data-driven business services; Why the Point-of-Sale is the ultimate channel for digital success; What will be the key tenets of the payments ecosystem in the next five to ten years; And more. Download our sentiment paper today to discover more.

06 December 2023 687 downloads

White Paper

UK Open Banking API Performance 2022-2023

The UK continues to be at the forefront of the global Open Banking revolution thanks to the proactive attitude of regulators. As the most advanced Open Banking market in the world, the UK provides an example of best practices in the implementation of API-based Open Banking that other jurisdictions can use as a model. In this report, we study the performance of the Open Banking APIs exposed by the large CMA9 UK banks, traditional High Street banks, credit card providers and building societies, and new entrant banks (neobanks). Some of our key findings include: There continue to be significant API performance differences between banks; There is a significant difference in total latency between the fastest and slowest banks; Cloud choice makes a huge difference in performance; And more. Download our analysis of Open Banking API services today to learn more.

07 November 2023 646 downloads

White Paper

How can the future state of information technology combat fraud and money laundering?

Modernisation programmes, digital service proliferation, client demand and advancing technology are all shaping the evolution and the future of financial services. Real time is the order of the day, and while real time payments come more and more to the fore globally, payment providers need to get up to speed in being able to offer them to their clients and end users, but also to ensure they are deployed and implemented in a fully robust, resilient and secure environment. With real time payments comes real time fraud and the opportunities for value on both sides of the fence is eye-wateringly vast. Firms cannot afford to have payments held up by authorisation checks, fraud and AML controls and yet at the same time the sheer amount of information that should be processed with any given payment in order to scan, approve and hence protect against fraudulent or nefarious activity is great. Institutions are allocating more and more to defend against financial crime and this is at the same time good news and bad news for them. Being smart about such allocations means minimising the resource and disruption presented by legacy systems and instead working around them. Download this Finextra whitepaper, produced in association with Hazelcast, to learn more.

02 November 2023 393 downloads

Future of Report

The Future of Digital Banking in North America 2024

2023 was characterised by increasing amounts of uncertainty and a lack of clarity across the financial world. The collapse of banks, including Silicon Valley Bank, Signature Bank and First Republican Bank, in March 2023, added strain to already unsettled financial markets. While market volatility has remained relatively stable, soaring inflation and climbing interest rates slowed economic growth and this is expected to continue into 2024. While forecasts regarding the length and severity of a possible recession are speculative, experts are even more divided about stock market predictions for 2024. Optimism is strong in many investors who expect that 2024 is the year rates will stop rising and predict bullish turns that will see markets soar to new heights. Yet with many other factors affecting North American markets, the only certainty we can expect as we look towards 2024 is more uncertainty. This Finextra report on the outlook of North American banking trends, is produced in association with Money20/20 and includes key insights and commentary from industry experts at EY and Mastercard.

23 October 2023 738 downloads

White Paper

Build, Buy or Bust – Hybrid leapfrogging Legacy

The age-old Build Vs. Buy conundrum has never been brought into sharper focus than it is now. In light of unprecedented unpredictability and economic volatility in recent times, in light of converging pressure brought about as a result of myriad payments systems, real time rails, cross-border implications in a global village, standards development and heightened public awareness and expectation, financial institutions are leaping forwards by falling back on partners to bring systems in line with modern business expectations. Undoubtedly, the advent and availability of open source technology has intensified and strengthened both sides of the Build Vs. Buy argument. For one thing, it has enabled banks and financial organisations to tailor and sculpt new processes and systems around their exact needs, with the availability of non-proprietary technology. For another, it has brought about a plethora of third party ‘enablers’, as well as having inspired fintech services firms by way of creating plug-and-play or pay-as-you-go offerings. And alongside all of this, the development of cloud technology and its permeation throughout the financial services industry has oiled the wheels for the journey, facilitating the bespoke and dynamic capability that open source cloud offers, and compounding the technological know-how and prowess of both banks and fintech providers the world over. There are other influencing factors, such as the API economy, the concepts of open finance, open data; external global, market and economic drivers and events that shape the demand for improved and instant banking services in the first place, putting pressure on operations to the point that banks need to fast-track pretty much every modernisation or product development project they have going, inevitably having to outsource some of this burden. Download this Finextra report, produced in association with Cloudera, to learn more.

22 September 2023 266 downloads