The 2024 TransUnion report on the State of Ominichannel Fraud Report said that 13.3 percent of account logins for digital transactions in the Philippines in 2023 were suspected as "Digital Fraud."
The data also said the volume of suspected digital fraud worldwide rose 14 percent year-on-year in 2023 and 105 percent from 2019 to 2023, Business Mirror quoted the TransUnion report.
It added that data breaches that led to stolen credentials caused 8.3 percent of all digital transactions in the Philippines to be deemed as fraudulent.
This was 66 percent higher than the global average of 5 percent in the same period last year.
“As a result of credentials stolen in data breaches, it has become increasingly easy for fraudsters to perpetuate attacks that leave consumers vulnerable to account takeover at an earlier stage in the customer journey,” Yogesh Daware, chief commercial officer at TransUnion Philippines, said.
TransUnion noted that this outpaced the 6-percent growth in digital transactions between 2022 to 2023 and 90 percent from 2019 to 2023.
The second highest source of suspected Digital Fraud is in account creation at 3.2 percent..
The occurrence of suspected Digital Fraud at the initial stages of account login and creation is significantly higher than the final financial transaction stage, which had a rate of 1.2 percent
This stage usually involves activities such as purchases, withdrawals, and deposits, which typically take place towards the end of a customer’s journey.
Daware explained that the rise in suspected Digital Fraud in the account login and creation stages of the consumer journey may represent a paradigm shift of sorts among fraudsters.
“As data breaches continue to pose a threat to sensitive or confidential information across various industries in the Philippines, fraudsters could possibly leverage synthetic identities assembled in large part using credentials gathered from such incidents,” he added.
TransUnion said the industry that saw the highest suspected Digital Fraud rate was retail at 11.8 percent in 2023, despite being down 18 percent from 2022.
This was followed by financial services at 10 percent; communities (online dating, forums, etc.), 5.2 percent; logistics, 4.4 percent; public sector, 3.9 percent; travel and leisure, 3.2 percent; and telecommunications, 2.4 percent.
TransUnion said that the total number of financial services’ digital transactions occurring when the consumer was in the Philippines was 51 percent higher in 2023 versus 2022 with a surge of 113 percent from 2022 to 2023.
“In response to this, it is crucial for organizations across industries to take proactive measures to enhance their protection throughout the entire customer lifecycle,” Daware said.
“This entails strengthening capabilities at every touchpoint to ensure comprehensive protection for both businesses and consumers,” he added.
TransUnion explained that the rate or percentage of suspected Digital Fraud attempts reflect those that TransUnion customers determined in instances like the denial in real time due to fraudulent indicators; denial in real time for corporate policy violations; fraudulent upon customer investigation; or a corporate policy violation upon customer investigation—compared to all transactions it assessed for fraud.
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