APP Fraud To Reach $7.6 Billion by 2028 in Six Countries, ACI Says

Authorized push payment fraud could reach $7.6 billion in six markets, ACI Worldwide Inc. says in its latest Scamscope report.

Released Wednesday, the report looks at APP fraud in the United States, United Kingdom, India, Brazil, Australia, and the United Arab Emirates, all markets with real-time payments. APP fraud happens when a criminal convinces a payer to authorize a payment under false pretenses, ACI says.

It’s a problem not only because it’s fraud, but because the adoption of real-time payment services increases the speed and velocity of potential fraud.

“This trust-based manipulation makes APP scams particularly challenging to detect as the transaction appears legitimate and bypasses traditional fraud detection systems and controls,” ACI says. “As rapid global adoption of real-time payments transforms the speed and velocity of how money moves, enabling faster and more accessible transactions, scammers are exploiting the immediacy of these transactions to steal funds before they can be traced, spurring growth in real-time payment APP scams.”

For the United States, ACI forecasts that APP scams could reach $3 billion by 2028, up from $2.2 billion in 2023. And, APP fraud losses over a real-time payment service could top $2.1 billion in four years, up from $865.2 million in 2023.

“While older systems and digital wallet networks like Zelle, Venmo, and CashApp have established controls, these are clearly not enough to combat real-time scammers. And while TCH and the FedNow service provide strong fraud management capabilities, these are still evolving and are dependent on banks adopting best practices,” the report notes. “Obviously, there is still a lot of work to be done, but the relatively recent launch of the FedNow Service gives banks a chance to enhance customer education about the risk of real-time payments.”

Zelle, Venmo, and CashApp are peer-to-peer payments services. The Clearing House Payments Co. LLC, or TCH, operates the RTP real-time payments network that launched in 2017. FedNow, from the Federal Reserve, launched in 2023.

Specifically, the ACI report found that two out of five victims were coerced into making an authorized payment via impersonation or a request for an advance payment. The median loss for all types of U.S. app fraud was $500 in 2023, down from $650 in 2022.

The Scamscope report, conducted with research firm GlobalData Plc, is based on secondary research along with expert interviews and a consumer survey.