Top fraud trends in digital banking for 2025

Fraud is faster, smarter, and everywhere. In 2025, 1 in 20 verification attempts is fake—and rising. From deepfakes to real-time payment scams, financial institutions are under attack. The question isn’t if you’ll be targeted—it’s when. Are you ready?

Financial institutions in 2025 are experiencing a surge of sophisticated fraud attacks targeting online transactions, real-time payments, and every facet of digital banking. Fraudulent activity is evolving at an unprecedented pace, and neither banks, credit unions, nor fintechs can afford to underestimate the impact. Today’s threats range from synthetic identity fraud to rampant account takeover (ATO) incidents, impersonation fraud, and organized social engineering schemes: all undermining trust, customer experience, and profitability. The fastest-growing risks require fast, decisive action and forward-thinking fraud prevention strategies.

The growing problem of fraud in financial services

According to Veriff’s Future of Finance report, fraudulent activity within financial services increased by 21% between 2024 and 2025. Financial institutions now face a reality where 1 in every 20 verification attempts is deemed fraudulent. These attacks are no longer isolated: fraudsters are leveraging artificial intelligence (AI), machine learning, and fraud networks to create or manipulate accounts and exploit vulnerabilities in both established banks and innovative digital banking platforms.

Sectors such as cryptocurrency, real-time payment networks, and digital payment services have been hardest hit, with fraud rates almost double the global average. Traditional banks, meanwhile, reported 3.5 times more incidents of document tampering and forgery compared to the global mean. No segment is immune, and with the growth of online transactions, fraudsters are now exploiting the fastest-growing corners of the market.

Chris Skinner, a leading fintech thought leader, aptly describes the state of fraud as “teetering on the top of a hill.” He points to the accelerating sophistication of cybercriminals, who now exploit the very networks meant to connect us. The most urgent concern? Deepfake-enabled fraud. Skinner notes in his latest podcast episode with Veriff:

“The problem is, how can I verify I am me? Without that ability, you’ve got the ability for any criminal fraternity to defraud anyone.”

He highlights that while identity verification technologies have progressed, gaps remain, and criminals are already using AI to impersonate identities with alarming realism. Veriff’s data supports this: 1 in 20 verification attempts is fraudulent, and this trend is climbing.

The real cost of ignoring these challenges

Why fraud is a critical, urgent priority

The risks for financial services organizations are staggering. Veriff’s data reveals that 13% of industry decision-makers report losing up to 20% of annual revenue to fraud—losses that could have driven new product innovation or digital transformation for customers. In the context of competitive markets, that level of losses is not just a footnote; it’s a threat to long-term growth.

But revenue isn’t the only casualty:

Reputation: As identity fraud, account takeover, and social engineering attacks grab headlines, consumer trust erodes. The Veriff Fraud Index shows most customers will abandon financial institutions that don’t deliver robust fraud detection and online security in their customer experience.
Compliance risks: Laws like GDPR, DORA, and the Bank Secrecy Act demand strict protections for every bank account, customer record, and transaction. Non-compliance puts brands at risk of major penalties and negative investor attention.
Operational strain: Investigating fraud across accounts and online transactions burdens teams, drains resources, and keeps financial services organizations from focusing on strategic digital growth.

Unchecked, these issues can quickly eat away at profitability and credibility, especially as criminals scale fraudulent activity with cutting-edge technology.

Why fraud is a critical, urgent priority

Fraud trends now shape board-level discussions at both banks and credit unions. In a climate where 75.5% of fraud professionals say online fraud has hurt company revenue, and 72% report year-over-year increases in attacks, the risk is both clear and immediate, according to the Fraud Industry Pulse Survey 2025. “Fraud-as-a-service” models make it easier than ever for bad actors to deploy AI-powered scams, target bank accounts, exploit real-time payments, and bypass outdated controls across the financial services landscape.

As digital experiences evolve, today’s customers increasingly expect seamless, secure, and real-time payment interactions. The Fraud Industry Pulse Survey states also that 83% of fraud professionals have already adopted ID verification and biometric technologies, and 81% plan to deepen their reliance on them in the coming year. This growing investment reflects a broader industry recognition: fraud prevention isn’t just about compliance—it’s a strategic driver of trust, growth, and customer loyalty in digital banking.Leaders in the sector are recognizing this urgency, as echoed by recent industry voices such as Amazon CEO Andy Jassy’s 2025 Shareholder Letter, which emphasizes the relentless pace of innovation and the business costs of risk.

The solution: Veriff for financial services

Solving these challenges requires holistic, adaptable solutions. Veriff delivers a comprehensive platform that empowers financial services institutions to detect and prevent fraud across every point of the customer journey: using the power of artificial intelligence (AI), machine learning, and network insights.

1. AI-powered Identity Verification

Fraud detection is a core capability of Veriff’s Identity Verification solutions and analyzes every customer touchpoint—from new account sign-ups to online transactions. Synthetic identity fraud, forged documents, and suspicious behavior are identified before risk reaches the balance sheet, using advanced IDV and liveness detection technology.

What sets Veriff apart is its “human-on-the-loop” approach: an essential layer of oversight that integrates human intelligence into automated decision-making. While AI can process a vast number of identity checks in seconds, Veriff’s expert reviewers step in for edge cases, anomalies, or uncertain results. This hybrid system ensures false positives are minimized, and legitimate users aren’t wrongly flagged, improving both security and user experience.

As Veriff´s CEO Kaarel Kotkas emphasizes, “We’ve reached a point on the internet that we don’t believe if things are true unless proven by a reliable source,” explains Kaarel Kotkas, CEO of Veriff. “We can’t have single solutions. We need to have a multilayered approach to stay a step ahead of these issues.”

“We’ve reached a point on the internet that we don’t believe if things are true unless proven by a reliable source. We can’t have single solutions. We need to have a multilayered approach to stay a step ahead of these issues.”

Kaarel Kotkas CEO Veriff

2. Biometric authentication

Today, a password is not enough. With Veriff, financial institutions can implement seamless ongoing biometric authentication—facial recognition, and more—across mobile apps, online banking, and real-time payment services, securing every session and dramatically reducing ATO (account takeover) rates.

In the face of rising deepfake and AI-generated fraud, biometrics are now the most trusted technology for consumers—especially in financial services. Veriff’s biometric verification technology is designed to meet this demand with speed, accuracy, and minimal friction.

3. Network-wide cross-linking and pattern detection

Fraud attacks rarely occur in isolation. Veriff analyzes each new session against fraud insights across global institutions, rapidly identifying coordinated attacks, repeat rings, and fast-moving synthetic identity fraud schemes.

4. Veriff Named Industry Leader in Identity Verification by G2 and Chartis

In recognition of this impact, Veriff was named a Leader in G2’s Summer 2025 Grid® Report for Identity Verification, a designation based on verified customer reviews and platform performance across compliance, fraud prevention, and trust workflows.

Further strengthening Veriff’s industry leadership, the company has also been named a Category Leader by Chartis Research in its RiskTech Quadrant® for Identity Verification, Enterprise Fraud, and Anti-Fraud Platforms.

This recognition underscores Veriff’s commitment to delivering a best-in-class product experience—and further validates the measurable ROI institutions are already seeing from our solutions.

Why act now?

The landscape of fraud trends is only accelerating. Real time payments, the explosion of digital banking, and the evolution of AI mean waiting exposes banks, credit unions, and fintechs to even larger fraud attacks. By prioritizing fraud detection and investing in end-to-end prevention technology, financial institutions defend revenue, reputation, and future of customer trust in online transactions.