Financial Crime World

Here is the rewritten article in markdown format:

Banking Sector Vulnerabilities to Fraud in Indonesia Exposed

A recent study by GBG and The Asian Banker has revealed that the rate of fraud in Indonesia shows no signs of slowing down, with money mule fraud projected to rise by 68% in 2020-21. This alarming trend is expected to impact banking and finance consumers across the country.

The Study’s Findings

The study, which surveyed 324 respondents from financial institutions (FIs) in six Asia Pacific countries, including Indonesia, found that FIs are struggling to keep pace with the increasing complexity and volume of fraud and cyber-attacks. With the COVID-19 pandemic leading to a surge in online connectivity, Indonesians are increasingly resorting to mobile and app banking to access financial products and services.

Priorities for Financial Institutions

In response, 43% of FIs in Indonesia plan to prioritize rolling out instant loan products in 2020-21 to meet consumer demand and adjust to the new norm. However, this focus on accelerating the availability of instant loan products also increases the risk of fraud.

  • Money mule fraud, which involves coordinated social engineering and unsuspecting first-party scenarios, is a significant challenge for Indonesian FIs.
  • Other types of fraud, including synthetic (55%) and stolen ID (53%), are also expected to experience high growth rates in Indonesia.

Recommendations for Financial Institutions

In light of these findings, financial institutions are advised to prioritize customer safety and security when using digital products. According to June Lee, APAC Managing Director of GBG, “Indonesian FIs must find ways to help consumers gain familiarity and trust in digital financial products, while also mitigating the risk of fraud.” To achieve this, organizations need innovative solutions that converge mobile credit risk scoring with fraud technology.

Budget Allocation for Fraud Prevention

The study also revealed that Indonesian FIs are allocating a budget of USD$88.9 million to purchase new fraud prevention technology in 2020, making Indonesia the country with the third-highest budget for fraud prevention in the APAC region.

GBG’s Solution

GBG offers its proprietary Digital Risk Management and Intelligence Platform, which enables banking and non-banking FIs to increase online fraud detection accuracy by 30% while improving customer experience. The platform’s Machine Learning module helps reduce false positives, and orchestration module enhances fraud detection by managing third-party call-outs to a comprehensive range of solutions and data.

Accessing the Full Report

The full report is available for download at “Future-Proofing Fraud Prevention for Digital Channels: APAC FI Study”. For more information on GBG’s solutions, visit www.gbgplc.com/apac or follow them on Twitter @gbgplc or LinkedIn.