As digital payments become more prevalent, so are the numerous scams which accompany them.
According to a new report[pdf] from the Global Anti-Scam Alliance (GASA) and US fraud detection company Feedzai, banking, investment and shopping fraud continue to rise.
The report revealed that people around the world lost $1.03 trillion to fraud in 2023 through 58,329 cases investigated.
South Africa stands out among countries where fraudulent activity is skyrocketing, with consumers losing 3.4 percent of their gross domestic product (GDP) to fraud, about $12.9 billion.
In Kenya, where scammers are exploiting the popularity of mobile payments, 3.6 percent of GDP, or $3.9 billion, was lost. Two-fifths of the population fell victim to shopping fraud.
In terms of payment methods, SMS and text message scams are common in Kenya, while Nigerian scammers often use peer-to-peer (P2P) payments via electronic funds transfers and e-wallets to commit fraud.
This situation calls for increased due diligence by banks and fi, especially for larger transactions, to detect suspicious activity early.
Consumer education is also key. As technological advances rapidly penetrate the financial industry in most African countries, it is the responsibility of banks and financial players to ensure that their customers are financially literate. This will aid them to spot potential scams and also to identify fraudulent trends.
