55% of the frauds detected in India were third-party account takeover frauds, finds BioCatch

BioCatch has launched a report on digital fraud detection powered by behavioral biometric intelligence. The report findings present account takeover represents greater than half of all fraud circumstances for its clients in India. These findings come on the heels of a suggestion by the Reserve Financial institution of India (RBI) that monetary institutions in that country abandon text-based one-time passcodes as a method of secure authentication.

“The existing OTP-based authentication doesn’t protect customers against new-age frauds, including customer-initiated fraudulent transactions,” counter-fraud expert and former Head of Group Fraud Risk and Investigations at First Abu Dhabi Bank, Charanjeet S. Bhatia, stated in response to the RBI suggestion. “With the right technology and implementations, banks can do a lot more than what they are currently doing to protect customers.”

BioCatch’s 2024 Digital Banking Fraud Trends in India report offers a look at the latest fraud risks and prevention strategies for banks in the country as they rapidly employ digital transformation strategies. The report notes a concerning bump in mule accounts in India, consistent with what BioCatch data reveals as a rising global threat.

“The prevalence of mule accounts potentially represents the most under-the-radar trend in the entire fraud space,” BioCatch Director of Global Fraud Intelligence Tom Peacock stated. “The mule accounts banks succeed in identifying almost certainly represent just the tip of the iceberg. Indian financial institutions must employ more robust security measures to both detect and then shut down these sprawling mule networks.”

Key India Report Findings:

  • Account takeover attacks still dominate: Accounting for 55% of all fraud in India, third-party account takeover fraud represents a bigger slice of the fraud pie than the social engineering scams BioCatch sees exploding elsewhere on the planet.
  • Mules a massively under reported plague: Each system found to participate in mule activity in India logged into an average of 35 accounts each.
  • Fraudsters seemingly accessing Indian mule accounts from outside the country: While 86% of the first session of documented mule account activity came from within India, after a month that number fell to just 20% – and 16% of those sessions used a VPN.
  • BioCatch clients saw more mule activity (14% of the total) in Bhubaneswar than anywhere else in the country: Lucknow and Navi Mumbai accounted for 3.4% of recorded mule activity, two cities in West Bengal – Bhagabatipur and Gobindapur – 1.7% and 2.6% respectively, Mumbai 2.2%, Bengaluru 1.8%, and Cuttack 1.6%.

“The fraud threats we see in India are a mix of both common threats seen globally and unique threats we find only in this region,” BioCatch’s APAC Vice President of Sales, Richard Booth, said

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