A few months ago, I got a call from my bank. “There is a problem with your credit card, and you need to take action immediately,” they said. I trusted the phone number since it was saved in my contacts. The tone sounded professional. Still, I decided to be cautious and call my bank, which told me this was fraud – which I almost fell for despite my experience in financial fraud.
In CGAP’s 2022 global review of available data on the evolution of digital financial services (DFS) consumer risks, we concluded that fraud was a fast-growing risk for DFS users, together with data misuse. Our more recent desk research tells a similar story. However, measuring the scale of fraud remains difficult, with definitions and methodologies varying widely across contexts. This variation makes it challenging to get a precise idea of the scale of the risk and its evolution. With that said, the limited data available and reported perceptions of financial sector actors show an unprecedented sense of urgency that must be addressed.
The surging scale of global financial fraud
The 2026 OECD Consumer Finance Risk Monitor survey shows that close to 70% of the 60 jurisdictions that responded saw an increase in fraud and scams between 2024 and 2025. This data is consistent with a 2025 World Bank survey of financial sector authorities in 30 countries reporting that 59% consider fraud as the top consumer risk concern, causing a major supervisory challenge. Industry estimates from Nasdaq Verafin suggest global fraud losses rose from roughly USD $486 billion in 2023 to $579 billion in 2025, including $62 billion in losses from scams, with annualized growth of 19%. Data from the Global Anti-Scam Alliance also show alarming data. At a more granular level, nine national surveys conducted by CGAP and IPA confirm large-scale exposure of digital finance users to fraud.
Proportion of jurisdictions where reported financial scams and frauds increased, stayed the same or decreased (2021-2022 and 2024-2025)
Drivers of the "perfect storm" in digital finance
Several global forces are creating a perfect storm. Generative artificial intelligence (AI) enables highly personalized phishing and deepfakes at scale, and social media platforms provide fraudsters with direct access to billions of potential victims. In addition, the spread of real-time payment systems leaves little time to detect and stop suspicious transactions. Growing data sharing initiatives – including open finance regimes – create many positive opportunities but also new vulnerabilities. Finally, organized crime focused on financial fraud has been on the rise. According to the UN, in East Asia, several hundred thousand people from 66 countries are held against their will and forced to work in scam centers, sometimes in horrific conditions. This phenomenon illustrates how fraud has moved well beyond petty crime into a very well-organized, transborder industry.
The human cost and the threat to financial inclusion
The most immediate impact of fraud on consumers is financial. In Uganda, an IPA national survey showed that median fraud loss represented 23% of a household's monthly income. Beyond financial loss, fraud inflicts serious psychological harm. In Kenya, fraud victims reported feelings of anxiety, anger, and shame.
DFS users who encountered scams and lost money (as a percent of all DFS users)
In Kenya, Rwanda, and Uganda, CGAP and IPA national surveys show that users who lost money to fraud also showed significantly lower trust in digital financial service providers. Trust is a key foundation for financial inclusion, and once broken, it is difficult to rebuild. CGAP data shows that many users do not come back. In Peru, 11% of users who experienced fraud stopped using digital financial services altogether, and 25% reduced their usage. At this pace, there is a real risk of serious setbacks for financial inclusion, with significant consequences for consumers and for the breadth and depth of the financial sector.
A multi-dimensional threat demanding cross-border solutions
What makes fraud so complex is that it cuts across multiple dimensions of the financial sector, such as financial integrity and stability. As pointed out by the IMF, fraud poses risks to financial stability by eroding confidence in financial intermediaries and potentially affecting banks’ solvency. Fraud also feeds directly into money laundering, with money mules (individuals who knowingly or unknowingly transfer stolen funds) playing a central role. In the UK, Mastercard TRACE identified over 574,000 matches related to mule activity. Outseer claims that mule recruitment through real-time payment rails increased by 57% in 2023.
What has become evident is that combating fraud in digital finance requires both cross-sector and cross-border solutions.
Scams can move through social media platforms, telecom networks, e-commerce sites, or mobile money accounts. These channels are often overseen by different regulators, leaving no single authority with a full view of the fraud chain or the power to act across it.
What has become evident is that combating fraud in digital finance requires both cross-sector and cross-border solutions.
Because fraud is also a crime, justice and interior ministries must be involved as well. This is why national strategies need an ecosystem approach.
Fraud has also become a cross-border threat. The East Asia scam compounds mentioned earlier show how criminal networks exploit gaps between legal systems and operate where oversight is weaker. This jurisdictional arbitrage is a core reason fraud is so difficult to combat. An American consumer may be targeted by a scam run from East Asia, leaving no single national authority able to respond alone.
The challenge is clear. Fraud in digital finance is a fast-moving, cross-sector, cross-border threat that financial regulation alone cannot solve. Protecting consumers now requires coordinated action among financial regulators, telecom authorities, social media platforms, law enforcement, and international bodies. It also requires stronger capabilities, including AI-based detection and trusted data sharing across institutions and borders. The good news is that solutions are emerging.
CGAP's recent paper on protecting consumers from fraud in digital finance offers practical examples of solutions that have had some success that authorities and ecosystem actors can build on. Likewise, recent reports from the OECD and Consumers International provide useful information for authorities that combat fraud.
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