BioCatch has found that 68% of Italian banking leaders report rising fraud losses, with most expecting SEPA credit transfers to add risk.
BioCatch surveyed 100 leaders of fraud management, anti-money laundering (AML), and compliance teams at banks in Italy. Of those respondents, 68% said fraud losses at their institution are increasing, and 21% described the rise as significant. The scale of losses also sets Italy apart: 76% reported that their bank loses more than USD 10 million to fraud each year. That figure is 25 percentage points above the global average and the highest share recorded among the 17 countries included in the research.
SEPA transfers and the PSD3 liability question
Payment infrastructure features prominently in the findings. According to Thomas Peacock, Director of Global Fraud Intelligence at BioCatch, 78% of Italian banking leaders appear to expect Single Euro Payments Area (SEPA) credit transfers to raise fraud risk at their institution, a view held almost unanimously by the C-suite executives surveyed.
Peacock connected this concern to PSD3, which is set to place liability for scam reimbursement on banks. Under that arrangement, any additional fraud exposure linked to SEPA transfers could have a direct effect on banks’ financial results.
Italian institutions already appear to be preparing for the change. Nearly three-quarters of respondents (73%) said their bank is planning or implementing revisions to internal reimbursement policies ahead of PSD3. Voluntary reimbursement is also more widespread in Italy than elsewhere, as two-thirds of respondents said their organisation already reimburses more than half of scam victims. This is 22 percentage points above the global average and among the highest rates of any country in the survey.
Mobile channels drive scam activity
Social engineering scams rank high among the risks identified by Italian banks. More than half of respondents (53%) placed them among the top three threats facing their institution, and 18% ranked scams as the single largest risk.
The channels through which these scams originate are mobile. Respondents cited messaging apps (54%), social media (48%), and other phone apps (47%) as the most prominent sources of scam activity.
The survey also points to operational pressure on fraud teams. In total, 91% said fraud investigations at their institution take more than a day to be finished, and nearly one-third reported that investigations take more than two days.
