Mobile and financial industries to combat online fraud in Southeast Asia through new API solutions
November 26, 2024, Manila: According to a new report released today by the GSMA, more than half of online consumers surveyed across Southeast Asia have expressed growing concerns about online security when using digital banking and shopping services.
The report, titled “Consumer attitudes towards fraud and opportunities for mobile network operators in Southeast Asia” reveals that more than a quarter of respondents from Indonesia, Malaysia, the Philippines, Singapore and Thailand have been victims of financial crimes, such as online hacking, identity theft and bank card theft. In Singapore, the country where digital commerce is most prevalent, around 42% of respondents said they had been victims of financial fraud.
The report, launched today at the GSMA Digital Nation Summit in Manila, shows that Southeast Asian consumers ultimately hold banks and fintech companies responsible for protecting them against financial crime. However, a significant number also expect mobile device manufacturers and network operators to play a key role in protecting them from cybercriminals.
With this in mind, the GSMA has created the APAC Fintech Forum to bring together the mobile ecosystem with fintech and online commerce providers to collectively take responsibility for building safe and inclusive digital nations. In a further report published today called “Unlocking Innovation: The Role of MNO APIs in Transforming Financial Services and Digital Commerce in Southeast Asia,” the GSMA outlines clear areas where the mobile and fintech industries can work together to develop more secure services using API-driven solutions. , supported by the GSMA Open Gateway initiative.
Julian Gorman, head of Asia Pacific at GSMA, said: “Southeast Asia's changing digital landscape presents significant opportunities and challenges for consumers, businesses and service providers alike. Online fraud and scams have become a critical concern that requires robust and innovative responses. To protect consumers' digital trust, mobile operators and the digital commerce ecosystem must work more closely to address these challenges and use their technical capabilities and broad user reach to mitigate opportunities for bad actors..”
Key findings:
- Growing Fraud Concerns: Fraud, particularly online financial transactions, is one of the biggest concerns for consumers in Southeast Asia. More than half of respondents across all five markets expressed fears about the increasing likelihood of fraud and hacking. These concerns are particularly pronounced in Indonesia and Malaysia, where nearly 43% and 34% of respondents, respectively, said they were “very worried” about being victims of fraud. Singapore and Malaysia report the highest levels of direct fraud experience, with more than 30% of respondents having encountered financial fraud at least once. In contrast, Thailand and Indonesia report lower, but still significant, levels of fraud experiences, with between 20% and 26% of respondents indicating they have been affected.
- SIM swapping attacks: This type of fraud, in which a hacker gains control of a mobile number by transferring it to a new SIM card, is a major concern in several markets. Indonesia (78%) and the Philippines (71%) report the highest levels of concern about SIM swapping fraud, while Singapore, although relatively safer, still sees 50% of consumers very concerned.
- Mobile payments and e-wallets: With the growing adoption of mobile wallets and digital payments across the region, many consumers are concerned about the potential vulnerabilities of these platforms. Malaysia (75%) and Indonesia (91%) show particularly high e-wallet adoption rates, leading to increased consumer concern about fraud.
- Theft of personal data: In all five markets, consumers expressed serious concerns about the protection of their financial data. More than 60% of respondents in Malaysia, Indonesia and the Philippines are very concerned about the misuse or theft of personally identifiable information (PII) and financial data.
How the mobile and digital commerce industries can act:
By working together on essential initiatives to improve security, mobile and fintech companies can help address fraud issues. One critical area is the implementation of new security-enhanced application programmable interfaces (APIs). These new two-factor authentication (2FA) and SIM swap prevention APIs, developed through the GSMA Open Gateway initiative, can help online financial institutions, payment companies and online retailers strengthen the security of accounts.
“These measures can significantly reduce the risk of unauthorized access and fraudulent activity, giving consumers greater confidence in the security of their financial transactions.” Gorman said.
During the GSMA Digital Nation Manila Summit this week, industry leaders, policymakers and innovators will explore the critical role of mobile technology in ensuring digital trust and driving economic growth to create a digital future more inclusive. Leaders from the Philippine Department of Information and Communications Technology, Globe Telecom, Smart Communications, Meta, the Asian Development Bank and RCBC will discuss how leveraging technology and forming partnerships is essential to protect consumers and maintain trust in digital platforms.
Southeast Asia has one of the most innovative mobile ecosystems in the world when it comes to combating online fraud through the GSMA Open Gateway initiative. However, more financial institutions and online retailers need to embrace the technology. Earlier this year, Singapore's Singtel announced it would work with Thailand's AIS and Malaysia's Maxis to fight growing digital scams. By using Singtel's SingVerify service, you will help prevent the incidence of account takeovers and unauthorized transactions resulting from malware and phishing app scams. Indonesia's four main operators have launched new services to combat fraud and in the Philippines Globe Telecom and Smart Communications support the initiative.
COUNTRY DATA TABLE
| Singapore | Malaysia | Thailand | Indonesia | Philippines | |
| Respondents said they were “very concerned” about being victims of fraud. | 22.8% | 34.2% | 28.0% | 42.6% | 26.4% |
| Respondents have encountered financial fraud at least once. | 41.8% | 35.4% | 20.4% | 32.2% | 28.6% |
| Respondents believe account security risks are increasing | 79.2% | 67.0% | 63.8% | 59.4% | 71.4% |
| Respondents made a purchase directly from a conversational app | 22.2% | 61.8% | 77.2% | 51.6% | 58.4% |
| Respondents adopted an electronic wallet | 59.0% | 75.2% | 53.2% | 90.6% | 81.4% |
| Respondents expressed interest in preloaded information when registering for new services. | 54% | 61.4% | 54.8% | 59% | 55.6% |
| Respondents would change financial provider to have greater security | 75% | 83.4% | 74.2% | 74.2% | 82.8% |
About the GSMA
The GSMA is a global organization that unifies the mobile ecosystem to discover, develop and deliver critical innovation for positive business environments and social change. Our vision is to unlock the full power of connectivity so that people, industry and society thrive. Representing mobile operators and organizations across the mobile ecosystem and adjacent industries, the GSMA offers its members three broad pillars: connectivity for good, industry services and solutions, and outreach. This activity includes advancing policy, addressing today's biggest societal challenges, supporting the technology and interoperability that make mobile devices work, and providing the world's largest platform to convene the mobile ecosystem at the MWC and M360 series of events.
We invite you to learn more at gsma.com
Media contacts
GSMA Press Office
[email protected]
