12 Stats About Banking Fraud to Make That Impacts Businesses

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As technology advances, hackers and their financial fraud attack strategies improve, allowing them to deceive people and businesses with malicious intent.

Such activities have a direct and indirect influence on financial institutions, resulting in cash losses and reputational damage.

This necessitates that they safeguard themselves and their customers by preventing such events from occurring.

Continue reading if you’re still unsure about the financial losses that banking fraud causes every year to businesses. In this post, we’ll look at 12 statistics regarding banking fraud and how it affects institutions.

Let’s get right to it.

What is banking fraud?

Before diving into the most recent banking fraud statistics, it’s important to understand what banking fraud is and what it entails.

Banking fraud happens when someone pretends to be a bank official in order to steal money or other assets from a financial institution or its clients.

Bank fraud can in a variety of forms. Check fraud, debit and credit card fraud, safe deposit box fraud, and ACH fraud are some of the most frequent kinds of fraud.

Banking fraud types

Currently, there are many types of banking fraud types. Here are some of the most common ones:

  • Skimming–The process of duplicating information from a credit card’s magnetic strip is considered skimming.
  • Phone bank fraud–it is a type of online banking fraud that involves convincing the victim to voluntarily provide information or transfer their funds to another account.
  • Invoice fraud–This bank fraud example targets businesses by impersonating a vendor, generally by email, and requesting that the bank account through which invoices are paid be updated.
  • Online banking fraud–Phishing, virus assaults, catfish scams, and clone websites are all examples of online banking fraud. 
  • Card identity theft–Taking over a legitimate bank account and impersonating the owner, or using stolen or falsified documents to create an account in someone else’s name, are examples of this form of bank fraud.
  • Loan fraud–This type of financial fraud, like card identity theft, is taking out a loan in someone else’s name using stolen or fraudulent documents. 

12 Banking fraud statistics that impact businesses

1. Consumers reported losing more than $5.8 billion to fraud in 2021

According to the Federal Trade Commission, consumers in the United States lost more than $5.8 billion to fraud last year, up from $3.4 billion in 2020 (a 70% increase).

As more customers are exposed to bad events, they will be less eager to engage in operational transactions, loans, and other banking activity, both routine and unusual, resulting in significant losses for financial institutions.

2. Almost 2.8 million people filed a fraud complaint

According to the Federal Trade Commission, more than 1.4 million Americans were victims of identity theft in 2021, with another 1.5 million submitting complaints under “other” categories (including credit reporting companies failing to investigate disputed information, or debt collectors falsely representing the amount or status of debt).

3. 62% of companies indicated that they first learn of fraud incidents only after their customers notify them

According to the Bank Info Security’s Faces of Fraud Survey, 62% of companies learn about fraud incidents only after their consumers report them. These figures may lead you to believe that businesses aren’t fully and immediately aware of the fraud situations that their consumers face on a regular basis, which may be prevented and avoided.

4. 65% say payment card fraud is the most common form of fraud

According to the Bank Info Security’s Faces of Fraud Survey, payment card fraud is the most prevalent type of fraud for 65% of those surveyed.

Any type of theft or fraud using a credit card is referred to as credit card fraud. Credit card fraud is used to make purchases without paying for them or to steal money from someone else’s credit card account.

Because online payments frequently entail the usage of sensitive data associated with credit or debit cards, they appear to be one of the most common types of fraud that firms must guard against.

5. Banking fraud attacks grew a whopping 159% in 2021 compared to 2020

Feedzai revealed in its Quarterly Financial Crime Report, based on an examination of over 12 billion worldwide banking transactions from January to March 2021, that total banking fraud attacks—internet, telephone, and branch—increased by 159% in Q1 2021 compared to Q4 2020.

6. 728% increase in telephone banking fraud

Telephone banking fraud has increased by 728%, according to Feedzai’s Quarterly Financial Crime Report.

Frauds using telephone banking are getting increasingly popular. The scammers do not defraud their victims on the internet, but rather over the phone. The following is how it works: consumers receive a call from someone claiming to be from a reputable organization, like as their bank or the police, and they are asked for personal information and passwords.

Although HSBC UK has observed a considerable decline in telephone banking fraud, with the bank’s voice biometrics system detecting 370 fraudulent calls in January 2022, down from 1,340 in January 2021, it is still an effective and common fraud attempt.

7. Online fraud accounts for 83% of all card fraud attacks

With the rise in internet usage, online shopping, and online payments, there has undoubtedly been an increase in fraud tactics by untrustworthy individuals.

The epidemic has intensified this tendency, with online fraud accounting for 83% of all card fraud attempts, according to Feedzai’s Quarterly Financial Crime Report.

A statistic that makes businesses on alert, as an attacked consumer, may indirectly affect their sales and continuity.

8. Online banking accounted for 33% of U.S. banks’ fraud costs in 2021

As mentioned in ABA banking journal’s article, online banking accounted for 33% of U.S. banks’ fraud costs in 2021, up from 26% in 2020.

In this way, the rise in internet usage has amplified the prevalence of financial fraud attempts and the resulting damage to customers and businesses.

9. 18-34-year-olds lose an average of £2630 to fraud

According to a 2019 Lloyds Bank survey, millennials are more likely than any other age group to fall victim to scams involving the transfer of money to fraudsters.

According to new statistics, victims aged 18 to 34 lose an average of £2,630 to frauds, which generally include scammers impersonating bank employees, police officers, or HM Revenue and Customs.

Despite losing less money when defrauded, more millennials have lost money, with the number of them being scammed nearly tripling.

There are more than three times as many people aged between 45 and 54 being scammed out of money than those over 55, according to the figures. Lloyds revealed that people in this age group are being tricked out of an average of £3,573 per fraud.

Younger individuals are likely to be misled at a far higher rate than their peers due to their growing usage of internet banking, which fraudsters have increasingly targeted.

10. Payment fraud is expected to continue increasing and projected to cost $40.62 billion in 2027

Payment fraud is expected to cost $40.62 billion in 2027, according to Merchant Savvy’s Global Payment Fraud Statistics, Trends, and Forecasts, a 25% rise from 2020.

11. For every dollar of fraud lost in 2021, U.S. financial services firms saw $4.00 in costs 

According to ABA Banking Journal’s report, for every dollar of fraud lost in 2021, U.S. financial services organizations would incur $4 in expenses, up from $3.64 in 2020 before the pandemic.

These costs include the transaction face value, fees and interest, fines and legal fees, labor and investigative costs, and external recovery charges.

12. Fraud prevention for banks reduced fraud attack response expenses by 42% and remedy expenses by 17%

According to Merchant Savvy’s Global Payment Fraud Statistics, companies with established fraud prevention systems lowered their fraud attack reaction costs by 42% and their solution expenses by 17% when compared to companies who did not have these measures in place.

According to the same study, whereas almost 60% of organizations that undertook an investigation after a fraud attempt ended up in a better situation (i.e. improved control environment, simplified processes, reduced losses, and higher employee morale), only 56% conducted any investigations at all.

This is why it is crucial to prioritize fraud prevention for banks.


Banking fraud has become more common as fraud assaults have become more refined, making it simpler for people to fall victim to such questionable practices.

In reality, as evidenced by the statistics presented in this article, numbers are growing year after year. As a result, the necessity for prevention becomes increasingly important.

Fortunately, today’s technologies enable the prevention and protection from malicious attacks, saving financial institutions from high remediation costs, as well as legal and reputational repercussions.

Using banking fraud detection software appears to be one of the better solutions to consider right now.

Thank you for spending time reading this blog article. Hopefully, you found it informative and useful.

If you want to read more, please check out this article: is investing in AI a smart move for your small business?


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