FICO survey reveals identity theft & fraud fears among Indonesians
An analytical software company, FICO, has disclosed findings from its recent global consumer fraud survey illustrating prolonged concerns over identity theft among Indonesians amidst increasing risks related to real-time payments. FICO's survey points out that 36% of Indonesians remain chiefly anxious about identity theft, leaving individuals susceptible to a variety of threats such as financial loss, impending damage to credit scores, and the taxing undertaking of re-establishing financial credibility.
Contrarily, the apprehension regarding authorised push payment (APP) scams in Indonesia is significantly less compared to other ASEAN nations and India. FICO's research shows a mere 28% of Indonesian respondents expressed unease about APP scams, a figure considerably lower than the Asian average of 33%.
The discrepancy can be linked to Indonesia's recent utilisation of real-time payment mechanisms in early 2022, hence limiting Indonesian consumers' exposure to such scams. "This is contrary to their equivalents in other regions where real-time payments are more entrenched," informs C K Leo, FICO's fraud, security, and financial crime lead in Asia Pacific. He adds: "However, with real-time payment acceptance speeding up, the risk of authorised push payment fraud increases, emphasising the importance for financial bodies to apply robust fraud detection and prevention measures speedily."
Insightfully, the study revealed a mismatch between perception and reality among Indonesians regarding identity theft. Approximately 45% believe it unlikely they've been targeted, whereas 21% think it possible and 16% are confident their identity remains inviolate. Significantly, a mere 3% of Indonesian respondents reported their stolen identity being used to open a financial account. Nevertheless, given the size of Indonesia's adult demographic, even this small percentage equates to well over 6 million individuals.
Simultaneously, FICO's research revealed a worrying trend concerning APP fraud related to real-time payments in Indonesia. Around 64% of Indonesians have received unsolicited text messages, emails, or calls believed to be part of a scam, while 49% reported that their friends or family members had been scam victims.
Surprisingly, 17% of respondents acknowledged sending real-time payments for investments, goods, or services they never received. Furthermore, of those who made scam payments through real-time payments, 71% lost up to 5 million rupiah, while 4% experienced losses of up to 100 million rupiah. Despite these staggering figures, only 19% reported actual or suspected losses to their banks.
"Financial institutions currently have an essential moment to invest in advanced solutions to address the surge in scams, especially in the face of the quick adoption of real-time payments in the Asia-Pacific financial landscape," emphasises Leo. "The non-reversible nature of these transactions has led to new criminal threats. Banks can preemptively identify and block scam payments, sparing customers from financial damage by incorporating scam-specific analysis and scoring into transactions."
When selecting a new financial services provider, respondents' top considerations were ease of use and good fraud protection. These considerations were ranked higher than aspects such as strong anti-money laundering policies, ethical use of customer data, sound green/environmental policies, behaving fairly, and good value for money.
