Faster Payments

Could September 23 Be A Hacker Holiday?

When the U.K. introduced Faster Payments, there was an increase in fraud attacks. With the U.S. Same Day ACH rollout just two weeks away and other Faster Payments initiatives taking off, will the same happen here in the States? In the latest Faster Payments Tracker™, PYMNTS spoke with Luis Rojas, Guardian Analytics Vice President of Product Management, about how moving payments faster has an impact on cybercrime. Find that, along with the latest headlines from around the space, in this month’s Tracker.

With the Same Day ACH rollout just weeks away, financial institutions are working to make sure that Faster Payments in the United States are not plagued by the same problems they were across the pond.

When the U.K. rolled out Faster Payments a few years ago, fraud spiked, as fraudsters acted quickly to take advantage of the reduced timeframe. Often, hackers and bad actors would try to sneak fraudulent transactions past banks when they are at their busiest, particularly when a financial institution is up against a fast-approaching deadline. To prepare for a potential increase in cyberattacks, industry players are looking to protect data using behavioral analytics and other fraud prevention techniques.

In the September edition of the Faster Payments Tracker™, PYMNTS caught up with Luis Rojas, Vice President of Product Management for Guardian Analytics, to discuss Same Day ACH’s potential impact on cybercrime.

Here’s a preview:

When the United Kingdom introduced faster payments in 2008, there was a 132 percent spike in fraud as cybercriminals tried to take advantage of the reduced time frame, according to Rojas. This fraud increase came after various financial institutions failed to implement a solid authentication apparatus to keep a check on fraudsters. In 2009, it was 14 percent higher than levels seen the previous year. And after a brief dip in 2010-2011, the increase continued until it peaked in 2014, according to Financial Fraud Action UK.

In the United States, Rojas predicts a comparable pattern and anticipates criminals using sneaky tactics during cyberattacks.

“People are bracing for a similar spike here,” he added. “We think that fraudsters will try to slip in during very busy times, but particularly when banks are up against the cutoff windows.”

They may also try to break up larger transactions into smaller transactions and space them out so that they become harder to detect and at least one of them has the chance to get through, he said.

Around the world of Faster Payments

Recently, companies across the financial sector have been gearing up for the Same Day ACH rollout by improving their payment-related technologies. For example, real-time payments provider Dwolla recently launched a dashboard that merges ACH features into business processes and helps smaller businesses access similar automated payments.

Meanwhile, Guardian Analytics has launched a real-time ACH service that provides protection against potential fraud associated with a Faster Payments environment. It was also a busy month for Early Warning, as the company formed multiple partnerships with some major players from the sector, including Fiserv, Mastercard and Visa.

To download the September edition of the PYMNTS.com Faster Payments Tracker™, click the button below.

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About The Tracker

The PYMNTS Faster Payments Tracker™ is your go-to resource for staying up to date on a month-by-month basis. The Tracker highlights the contribution of different stakeholders, including institutions and technology coming together to make this happen.

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New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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