Suspected Digital Fraud Attempts from Zambia the Highest in Financial Services and Telecommunications

As consumers and businesses continue to use digital transactions as a way to engage in commerce, fraudsters are increasingly using them for their own benefit. A new TransUnion (NYSE: TRU) analysis finds that suspected global digital fraud¹ is up in the first half (H1)² of 2023, and while retail and video gaming* were among the most targeted industries worldwide during that timeframe, digital fraud affected all businesses.

Among all industries, the global suspected digital fraud rate stood at 5.3% in H1 2023, up from 4.5% one year ago¹. Of all transactions made by consumers in Zambia, 1.6% were suspected to be fraudulent attempts in H1 2023.³

For transactions originating from Zambia, financial services and telecommunications industries had the highest suspected digital fraud attempt rate among industries analyzed in H1 2023 at 12.1% and 2.5% respectively. While the suspected digital fraud rate in gaming (online sports betting etc) was 1.1%, this reflected a 199% year-over-year (YoY) volume increase.

With a 10% growth in transaction volume when comparing H1 2022 to H1 2023, the financial services sector saw a 262% increase in the volume of suspected digital fraud attempts year-over-year (YoY), with suspected digital fraud in telecommunications increasing by 92%, and by 62% in travel and leisure for transactions from Zambia.

Although the number of digital transactions in gaming from Zambia increased the most among all industries analyzed in H1 2023 at 583%, the rate of suspected digital fraud attempts in this industry coming from Zambia was only 1.1%. However, the volume of suspected digital fraud increased by 199% YoY. ³  

These significant increases in the volume of suspected digital fraud attempts, along with the increased adoption of digital transactions, indicate that Zambian businesses and consumers should seek meaningful solutions to prevent fraud.  

“It’s not enough to look at fraud rates alone when attempting to measure the impact of digital fraud on any one particular industry or another,” said Mildred Stephenson, chief executive officer at TransUnion Zambia. “There are other factors that need to be considered. These include the overall size of the industry in question, whether that industry is growing and if so, how quickly. Only then is it possible to develop a more comprehensive perspective on just how digital fraud is impacting these industries. In addition, this can help identify where fraudsters may be focusing their efforts in future.”

Gaming Saw the Greatest YoY Growth in Digital Transactions

while Financial Services had the Highest Suspected Digital Fraud Rate Coming from Zambia

^{Source: TransUnion TruValidateTM data}

^{*Video gaming was not included in Zambia’s reporting as volumes were statistically insignificant}

More Than Four in Five (85%) Zambians Report Having Recently Been Targeted by Fraud

This new TransUnion analysis comes on the heels of its recent Q2 2023 Zambia Consumer Pulse Study which explored, among other things, consumer awareness of being targeted by any online, email, phone call or text messaging fraud attempt in the second quarter.  

The study⁴ found that 76% of Zambians reported being targeted by a fraud scheme but didn’t become a victim of it, and 9% said they had been targeted and fell victim in the last three months. Among those targeted, the most frequent fraud schemes by which they reported being attacked were a money or gift card scam (46%), smishing (43%), phishing (35%) and vishing (33%). Smishing is the fraudulent use of text messages aimed at tricking the recipient into revealing personal data, while phishing refers to the same practice via email, websites, social posts or QR codes, and vishing by phone call.

TransUnion fraud findings are based on intelligence from its identity and fraud product suite, TransUnion TruValidate, which helps secure trust across channels and delivers efficient consumer experiences. The rate or percentage of suspected digital fraud attempts reflect interactions in which TransUnion customers either denied in real time due to fraudulent indicators or determined to be fraudulent after a manual review process—compared to all transactions it assessed for fraud.

Download the Omnichannel Fraud in H1 2023 Infographic for more findings including the rate of suspected digital fraud from select countries and regions globally, and the growing problem of synthetic fraud. Specific country and regional data in the analysis include the United States, Brazil, Canada, Chile, Colombia, Dominican Republic, Hong Kong, India, Kenya, Mexico, Namibia, Philippines, Puerto Rico, Rwanda, South Africa, Spain, United Kingdom and Zambia.

Consumers who believe they may be a victim of fraud can find resources and information here.

^{1 Digital fraud involves the use of phishing emails, false websites, phony mobile apps, fake social media profiles, and other mechanisms to illegally obtain information and defraud consumers and businesses.}

^{2 The first half of the year or H1 refers to Jan. 1 to June 30}

^{3 TransUnion TruValidate data}

^{4 TransUnion Consumer Pulse Survey}