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. 

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