Digital banking fraud is at an all-time high in South Africa


Columinate has published its latest annual digital banking report, revealing the state of the current digital banking landscape in South Africa – including worrying new scam trends.

According to the group’s report – which is based on the responses of over 13,000 South African e-bankers to gauge their behaviours and experiences when using digital platforms – there is a growing preference among users to use apps for their banking needs.

This includes doing anything they can to avoid having to go to a bank branch – from applying for new bank cards, opening new accounts, or even getting recent bank statements.

“It makes sense for the banks to focus on creating a secure, well-rounded service offering through their mobile banking applications,” the group said.

However, with the growth in using digital channels, security problems have also cropped up.


“It’s discouraging to discover that digital banking fraud is at an all-time high, and there’s been a steady increase in this trend over the last four years,” the group said.

While SITEisfaction recorded a marked increase in the awareness of potential fraud and scams across the board, 22% of users still fell victim to these criminals in the last year, up from 19% in 2017, 14% in 2016, and 12% in 2015.

A few new scams also made their debut in 2018, including:

  • 13% of users fell victim to the advanced “Free Loan” / “Prequalified Loan or Credit Card” scam;
  • 8% of users fell victim to the “You are a winner” Pay-to-Play scam;
  • 7% of users fell victim to phishing scams – while 36% of users were targetted;
  • 6% of users fell victim to the traditional 419 scam;
  • 4% of users were taken advantage of with the “Request for Help” email fraud (which is the natural evolution of the 419 scam – asking for help and promising riches in return);

“When it comes to the world of mobile banking, security ought to be the utmost priority and concern – as technological counter-measures evolve, so do criminals.

While a handful of banks did take the initiative to educate their customers on the looming threats, the message is far from reaching saturation in the South African market,” Columinate said.

“The onus is on the banks to create banking platforms that are as secure as they are perceived to be, and to continually remind customers about new and potential threats – if they can get the security right, we’d have the tools to create a truly end-to-end digital banking solution, with less need to visit a branch ever again.”