By: LSEG Risk Intelligence
As the new year unfolds, we unpack the key trends we anticipate in the global payments space.
- Real-Time Payments and Cross-Border Solutions: As businesses adopt faster payment systems and expand global transactions, they must address the increasing risk of fraud that comes with these innovations.
- Advanced Fraud Prevention: With fraudsters using more sophisticated techniques, companies will need to leverage AI, big data, and digital identities to build comprehensive, proactive fraud prevention strategies.
- Strengthening Supply Chain Security: As supply chains diversify, robust vendor management and real-time account verification will become crucial to prevent fraud in global operations.
- Holistic Fraud Prevention: As fraud continues to evolve, businesses must adopt a comprehensive, multi-layered approach that spans the entire customer and supplier lifecycle, integrating AI, big data, and continuous monitoring to effectively combat emerging threats.
An evolving landscape
Digital transformation and rapid developments in the real-time payments space continue to transform markets. These innovations allow providers to offer their customers increased speed and better efficiency, along with 24/7 availability – but at the same time, opportunities for fraud and financial crime are growing.
Digital transformation is a double-edged sword. As businesses increasingly leverage evolving tech, they optimize their offerings and acquire better tools to detect fraud. However, the increased use of digital channels also exposes them to a wider range of sophisticated threats – such as account takeovers, synthetic identity fraud, real-time fraud schemes, and more.
Bad actors are highly adept at leveraging industry innovation and the power of evolving tech to plan and execute sophisticated attacks – and the scale of illicit activity just keeps growing. For example, synthetic identity fraud is projected to generate at least US$23 billion in losses in the U.S. alone by 2030[1].
As the number of fraud attempts continues to rise and payments-related risks become ever-more complex and sophisticated, organisations will need enhanced security. They will need to adopt a holistic approach to fraud prevention – leveraging the right tools and strategies to safeguard their organisations and their customers.
2025: the key trends
Real-time payments will gain momentum
Real-time payment systems will become increasingly popular as financial institutions ramp up their adoption of platforms that allow instantaneous fund transfers. This key development will deliver numerous benefits, boosting efficiency, meeting customer expectations for speed and keeping the pace of business swift.
Cross-border payment solutions will expand
As consumers and businesses increasingly expect – even demand – more seamless international transactions, the financial sector will implement advancements in cross-border payment systems. This will lead to faster, more secure ways of handling global payments – but at the same time, offer more opportunities for sophisticated fraudsters.
The adoption of digital IDs will expand
We expect an increased roll out and adoption of electronic and digital IDs in 2025 (and even more so after Europe’s digital wallet mandate goes into effect in January 2026). These will bring enhanced inclusivity to the digital identity space – and will offer a highly capable backstop against fraud, synthetic identities and other types of impersonation.
Supply chain diversification will be essential
Organisations will need to take steps to minimise their exposure to geopolitical risk, and we expect to see companies increasingly diversifying their supply chains and opting for nearshoring strategies to plan for business continuity in volatile global markets. Alongside this diversification, robust vendor management will be crucial – especially in regions characterised by weaker fraud prevention infrastructure, a lack of vendor management organisations, or higher rates of risk relating to payment fraud, account takeovers and data breaches.
Fraudsters will keep getting smarter
Sophisticated scamming techniques are on the rise and fraudsters are highly adept at employing innovative methods and leveraging the latest tech to gain unauthorised access to user accounts. This means that organisations need to stay one step ahead – and will increasingly be looking for trust, privacy and efficiency within their tools and technologies.
The orchestration of data will move front and centre
The need for deterministic and probabilistic data will continue to grow, but data is only as good as the insights that can be extracted. Orchestrated signals and data create a single customer universe, so different fraud and AML teams can work together more efficiently. Consortia data models will also grow, as organisations pool data to combat fraud.
Holistic fraud prevention: an intelligent response
Developing an intelligent response to rising fraud is vital – and this means taking a holistic approach to fraud prevention.
To effectively fight back, organisations must implement comprehensive systems that span customer and supplier lifecycles, adding fraud prevention and security measures at every stage – from onboarding through to the ongoing monitoring of all interactions.
Moreover, it will be essential for organisations to leverage the growing capabilities of AI and big data technology – and to use every tool available to them to stay a step ahead of sophisticated fraudsters.
Originally Posted on January 27, 2025 on LSEG Insights
PHOTO CREDIT : https://www.shutterstock.com/g/Creativa
VIA SHUTTERSTOCK
FOOTNOTES AND SOURCES
1. 2023 FSI Predictions Report, Deloitte Center for Financial Services
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