New Payment Services: Financial Fraud Prevention Measures

Fraud and Financial Crime


Germaine Lang

Oct 7, 2019

The first 3 parts of this 5 part series focused on payment innovation, the difference between Open Banking vs. PSD2, and new banking and payment services resulting from the recent regulatory requirement entrants. This 4th part explores financial fraud prevention measures and how to leverage technology advancements to secure payments in this new payments landscape.

It’s no secret that financial crime continues to be a thorn in the side of corporates and banks – with cyber fraud being at the top of the list. Cyber fraudsters are technically savvy and as soon as a new, faster payment method is in play it seems they are armed with a new, counter-tactic to divert money or sensitive information away from its rightful place.

But rest-assured, as nefarious as fraudsters can be technology gurus are constantly trying to stay one step ahead with innovative countermeasures to combat cybercrime and help banks and financial institutions stay compliant. Here are a few of the latest financial fraud prevention measures to detect and prevent fraud BEFORE it happens, keeping your data safe and your finds in the right hands:

Be Vigilant: Transaction and User Behavior Monitoring - one proven way to prevent fraud is to be on the lookout for variations in user behavior and unusual transaction patterns. Employing advanced analytics and being proactive about profiling your users with machine learning technology that provides continuous updates can help your bank identify and block threats.

Be Protected: Anti-Money Laundering - banks are also required to prevent money-laundering, or face huge fines for any breach. Using a cloud-based sanctions screening tool will help banks ensure they are checking all transactions against the most up-to-date sanction lists and protect them against reputational damage and other negative consequences.

Be Compliant: PSD2 and Strong Customer Authentication – recent changes in payment regulations, specifically in regards to Strong Customer Authentication, and PSD2 which places that authentication responsibility on payment services providers, makes the use of Multi Factor Authentication (MFA) a requirement. MFA typically combines two or more data points verifying a user’s identify at log in.

For a deeper dive into these fraud prevention technologies and other topics related to new payment services, download the full whitepaper by Marcus Hughes, How Banks Can Create Winning Propositions While Complying with PSD2.

And for more insights into the payments industry and beyond, subscribe now and stay up-to-date on the latest tips, trends and topics.

Follow these links to see other posts in this series about the implications and opportunities presented by new payment regulations:

The World Is Watching: PSD2 and Open Banking Drive Innovation, Part 1
Open Banking and PSD2: What’s the difference and Why Should You Care?, Part 2
New Payments Services: Enhancing Security and Improving Transparency, Part 3


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Germaine Lang

Germaine Lang is the Managing Editor of SmartPayments with a strong creative and technical writing background across many industries. She also works to engage customers and relate their experiences with vendor products and services, positioning them as innovative thought leaders.
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