FICO Survey: 1 in 3 Malaysians Worried About Being Scammed As Real-Time Payment Risks Grow

Rhea-AI Summary

FICO's latest survey reveals that 32% of Malaysians are concerned about payment fraud, with real-time payment scams on the rise. Identity theft worries persist, affecting 37% of respondents. Real-time payment adoption is growing rapidly, with 92% of adults using it and 55% expecting increased use next year. Despite the convenience, 76% have received scam communications, and 19% have fallen victim to scams involving real-time payments. Most losses were under MYR 500, though some were as high as MYR 7,500. Only 28% reported these losses to their banks. Malaysians prioritize fraud protection and ease of use when selecting financial service providers. FICO emphasizes the need for banks to invest in advanced fraud detection solutions amid this trend.

Positive

• Real-time payment adoption is high, with 92% of Malaysians using it.
• 55% of Malaysians expect to increase their use of real-time payments next year.
• Fraud protection and ease of use are top priorities for Malaysians when choosing financial service providers.
• Banks have an opportunity to leverage advanced fraud detection solutions to protect customers.

Negative

• 32% of Malaysians are highly concerned about payment fraud.
• 37% worry about identity theft.
• 76% have received scam communications.
• 19% have fallen victim to real-time payment scams.
• 41% of scam victims lost up to MYR 500, and 10% lost up to MYR 7,500.
• Only 28% of victims reported the loss to their banks.

32% of Malaysians are most concerned about being tricked into making payment to a criminal

KUALA LUMPUR, Malaysia--(BUSINESS WIRE)-- (NYSE: FICO)

Highlights

• Payment Fraud is top financial crime concern for 32% of Malaysians
• Identity theft worries persist, with 37% believing they have or might have been victims
• Real-time payment scams are on the rise, with 76% receiving scam communications
• Fraud protection is paramount, with ease of use and good fraud protection ranking as top considerations for selecting financial services providers

FICO, a leading global analytics software firm, today unveiled its latest global consumer fraud research, shedding light on Malaysians' ongoing apprehension regarding real-time payment scams amid the growing adoption of new, convenient, and fast payment channels. According to the study, the primary worry for Malaysians remains the risk of being tricked into sending money to criminals (32%), which exposes individuals to instant, irrevocable losses rarely eligible for reimbursement.

Additionally, concerns about identity theft persist, with over 25% of Malaysians citing it as their top financial crime concern. This type of fraud carries additional risks beyond financial loss, such as compromised credit scores and the challenging process of restoring financial integrity.

More information: https://www.fico.com/en/latest-thinking/ebook/consumer-survey-2023-digital-banking-customer-preferences-and-fraud-controls

“Malaysia’s adoption of real-time payments continues to accelerate, with 92% of adults having sent a real-time payment and 55% expecting to increase their use over the next year,” said C K Leo, FICO's lead for fraud, security and financial crime in Asia Pacific. “As the adoption of real-time payments surges, driven by platforms like Boost, Touch & Go (TnG), and GrabPay, we're witnessing a transformative shift in financial behaviour. Yet, amidst this rapid digitisation comes an urgent need for heightened vigilance against fraudsters lurking in the digital realm.”

Real-Time Payment Scams: A Growing Concern

As the incidence of scams continues to rise, FICO’s research from last year uncovered a troubling trend related to authorised push payment (APP) fraud and real-time payments in Malaysia. A concerning 76% of Malaysians have received unsolicited text messages, emails, phone calls, or other outreach that they believed to be part of a scam, while 54% of respondents stated that their friends or family members had been victims of a scam.

Shockingly, 19% of respondents admitted to sending real-time payments for investments, goods, or services they never received. Additionally, 41% of those who made scam payments through real-time payments lost up to MYR 500, while 10% experienced losses of up to MYR 7,500. Despite these alarming figures, only 28% reported actual or suspected losses to their banks.

"Banks now face a crucial moment to invest in cutting-edge solutions to tackle the surge in scams, particularly with the swift uptake of real-time payments in the Asia-Pacific financial landscape,” said Leo. “The irrevocable nature of these transactions has led to new criminal threats. By integrating scam-specific analysis and scoring into transactions, along with robust decision-making capabilities across the customer journey, banks can pre-emptively detect and thwart scam payments, sparing customers from financial harm. Furthermore, while some consumers may ignore warnings, the majority will heed alerts and refrain from making real-time payments if alerted to potential scams."

Perception vs. Reality

Despite widespread concern about identity theft, there is a noticeable dissonance between perception and reality among Malaysians. About 32% believe it unlikely they've been a victim, while 18% see it as possible, and 17% are confident their identity remains untouched.

Moreover, only 7% of Malaysian respondents reported their stolen identity being used to open a financial account, an increase from nearly 6% in 2022. However, given Malaysia’s adult population, this 7% translates to over 1.6 million individuals. Interestingly, this rate was much higher in other countries surveyed, with 13% of Indians and 12% of Thais saying their identity had been stolen and used to open an account by a fraudster.

“While some may downplay the risk of identity theft in Malaysia, millions remain vulnerable,” added Leo. “This underscores the need for heightened awareness and proactive measures. By breaking down silos and integrating identity verification and fraud detection processes, we can streamline applications and bolster trust in legitimate customers.”

Malaysians Prioritise Good Fraud Protection

When asked about the most important considerations respondents have when they select a new provider for a financial account, good fraud protection and ease of use were the two most important. These were both considered significantly more important than good customer service, strong anti-money laundering policies, sound green/environmental policies, ethical use of customer data, behaving fairly, and good value for money.

The survey was conducted in November 2023 by an independent research company adhering to research industry standards. 1,000 Malaysian adults were surveyed, along with approximately 12,000 other consumers in Canada, U.S., Brazil, Colombia, Mexico, India, Indonesia, Philippines, Singapore, Thailand, U.K. and Spain.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240520815297/en/

Lizzy Li

RICE for FICO

+65 9034 7768

lizzy.li@ricecomms.com

Saxon Shirley

FICO

+65 9171 0965

saxonshirley@fico.com

Source: FICO

FAQ

What percentage of Malaysians are worried about payment fraud according to the FICO survey?

32% of Malaysians are concerned about payment fraud.

How many Malaysians have received scam communications?

76% of Malaysians have received scam communications.

What is the percentage of Malaysians who have used real-time payments?

92% of Malaysians have used real-time payments.

What percentage of Malaysians expect to increase their use of real-time payments?

55% of Malaysians expect to increase their use of real-time payments next year.

What are the top considerations for Malaysians when choosing a financial service provider?

Fraud protection and ease of use are the top considerations for Malaysians.

How many Malaysians have fallen victim to real-time payment scams?

19% of Malaysians have fallen victim to real-time payment scams.

What percentage of scam victims reported their losses to banks?

Only 28% of scam victims reported their losses to banks.

What is the range of financial losses experienced by scam victims?

41% of scam victims lost up to MYR 500, and 10% lost up to MYR 7,500.