MINNEAPOLIS, Minn.—According to a new survey of nearly 300 financial institutions across the country—no surprise—payments fraud losses remain an issue for a majority of respondents.
The survey also found that customer diligence, such as reviewing transaction activity and statements online and reporting suspicious activity to their FIs, is very effective across all payments types, including cards, checks, and automated clearinghouse and wire transfers.
The survey, released by the Federal Reserve Bank of Minneapolis, aimed to identify ways to reduce payments fraud, the bank stated in a release.
The survey found that payments fraud losses are a problem for 75% of FIs. FI losses on debit and credit cards are common, with 96% of debit card issuers and 77% of credit card issuers reporting them in 2016. Over 80% of FIs report that they are issuing chip cards for authentication, illustrating that the industry is continuing to increase chip card adoption.
“This report provides great insights into what FIs are doing and find effective to mitigate payments fraud. FIs could use the information to benchmark their own fraud mitigation methods against those identified as effective in the survey,” said Guy Berg, vice president of the Payments, Standards, and Outreach Group at the Minneapolis Fed.
The report provides information about use and relative effectiveness of payments fraud detection and prevention methods as rated by FI respondents. Risk mitigation methods for each payment type are grouped into three categories: transaction screening and scoring, authentication methods, and other reporting and risk management methods.
Access the full 2017 Financial Institution Payments Fraud Mitigation Report.