Suspected Digital Fraud Attempts in Botswana Increase Sharply in the Financial Services and Online Gaming Sectors
TransUnion study determines financial services had the highest suspected Digital Fraud rate and year-over-year rate growth in Botswana among industries analyzed in 2023.
The rate of suspected Digital Fraud attempts for financial services transactions where the consumer was in Botswana when transacting increased by 196% year-over-year (YoY) to 9.7% in 2023. This was both the highest suspected Digital Fraud rate in 2023 and YoY rate growth among industries of statistical significance when the consumer is located in Botswana when transacting according to a new TransUnion (NYSE: TRU) analysis. Some of these findings can be found in TransUnion’s 2024 State of Omnichannel Fraud Report.
TransUnion found across industries in 2023, 3.0% of all transactions where the consumer was in Botswana were flagged as being suspected Digital Fraud – an 85% YoY increase.
The TransUnion report revealed that nearly one in seven (13.5%) newly created accounts are suspected to be created via Digital Fraud globally in 2023, largely driven by bad actors using fabricated or stolen identities. This may indicate a shift in the tactics deployed by fraudsters hoping to engage earlier in the transactional process.
Examples of the types of transactions that take place during the account creation process include account signup, registration and loan origination. Among the industries globally that saw the highest percentage of digital account creation transactions suspected to be Digital Fraud globally in 2023 were retail (44.7%), travel and leisure (36.0%), and video gaming (31.5%).
“This early-phase new account Digital Fraud may represent a paradigm shift of sorts among fraudsters globally,” said Kabelo Ramaselwana, chief executive officer at TransUnion Botswana. “In lieu of using traditional tactics to gain access to and ultimately compromise existing accounts, they are increasingly choosing to create new accounts that they can control themselves. These fraudsters leverage synthetic identities assembled in large part through the use of credentials gathered as a result of one or multiple data breaches.”
In contrast, for transactions where the consumer was in Botswana, the highest percentage of suspected Digital Fraud in the online customer journey occurred at account login, at 13.0%, varying widely by industry.
Retail Saw the Highest Suspected Digital Fraud Rate in 2023 Globally, While Online Gaming Continues to See the Highest Rate in Botswana*
| Industry | Botswana suspected Digital Fraud attempt rate 2023 | Botswana suspected Digital Fraud attempt rate % change YoY | Global suspected Digital Fraud attempt rate 2023 | Global suspected Digital Fraud attempt rate % change YoY |
| Financial services | 9.7% | 196% | 4.3% | 3% |
| Gaming (online sports betting, poker, etc.) | 3.6% | 105% | 5.3% | -30% |
| Retail | 1.3% | 1% | 8.7% | 21% |
| Communities (online dating, forums, etc.) | 0.4% | -18% | 4.6% | 17% |
| Travel & leisure | 0.2% | -44% | 2.3% | 8% |
Source: TransUnion TruValidate™
The study found that 5% of all global digital transactions were suspected to be Digital Fraud in 2023, with the volume of risky transactions up 14% YoY and 105% from 2019 to 2023. This growth continues to outpace the growth in digital transactions, which rose 90% from 2019 to 2023.
Globally, retail surpassed gaming as the industry seeing the highest rate of suspected Digital Fraud in 2023 at 8.7%, up 21% YoY. In addition, the telecommunications industry saw a 111% YoY increase in the suspected Digital Fraud rate, up to 4.5%.
“In recent years, the global retail industry has consistently been among those with the highest suspected fraud attempt rates. However, in 2023 it climbed to the top of the list,” said Ramaselwana. “As a result of credentials stolen in data breaches, often in industries other than retail, it has become increasingly easy for fraudsters to perpetuate attacks that leave retailers vulnerable to account takeover.”
TransUnion came to its conclusions about Digital Fraud based on intelligence from its identity and fraud product suite that helps secure trust across channels and delivers efficient consumer experiences – TransUnion TruValidate. The rate or percentage of suspected Digital Fraud attempts reflect those that TransUnion customers determined met one of the following conditions: 1) denial in real time due to fraudulent indicators, 2) denial in real time for corporate policy violations, 3) fraudulent upon customer investigation, or 4) a corporate policy violation upon customer investigation —compared to all transactions assessed.
The report’s findings are based on proprietary insights from TransUnion’s global intelligence network, and includes data from Botswana, Brazil, Canada, Chile, Colombia, the Dominican Republic, Hong Kong, India, Kenya, Mexico, Namibia, the Philippines, Puerto Rico, Rwanda, South Africa, Spain, the United Kingdom, the United States, and Zambia.
*Some industries were excluded from the Botswana study due to a lack of statistically significant data.
