The European Central Bank (ECB) and the European Banking Authority (EBA) have published a collaborative report on payment fraud data. This report evaluates payment fraud data that payment service providers in the European Economic Area (EEA) submit semi-annually for various payment methods like credit transfers and card payments.

The total value of fraud activities in 2022 and 2023 The document reported that fraudulent activities in credit transfers, direct debits, card payments, cash withdrawals, and e-money transactions in the EEA amounted to EUR 4.3 billion in 2022. By the first half of 2023, this figure had decreased to EUR 2 billion. In both value and volume, most payment fraud was associated with credit transfers and card payments.

Specifically, card payments constituted the highest volume of fraud. In the first half of 2023, card fraud involving EEA-issued cards represented 0.031% of the total value and 0.015% of the total number of card transactions. Similarly, e-money transactions showed comparable fraud rates at 0.022% in value and 0.012% in volume.

Conversely, fraud rates were significantly lower for other methods, notably credit transfers, with rates at 0.001% in value and 0.003% in volume. Customer authentication requirements benefits The report validates the beneficial effects of the strong customer authentication (SCA) regulations implemented as part of the revised EU Payment Services Directive (PSD2) and the accompanying technical standards established by the EBA in 2018 in collaboration with the ECB. Transactions authenticated through SCA showed reduced fraud rates compared to non-SCA transactions, notably in card payments.

Additionally, fraud rates in card payments were significantly higher when the other party was situated outside the EEA, where SCA compliance is not mandatory. Furthermore, the document shows that losses from payment fraud were not evenly distributed among those responsible and varied depending on the payment method or country. A large portion of card fraud (71% of the total value in the first half of 2023), as well as a substantial portion of credit transfer and direct debit fraud (43% and 47% respectively), were associated with cross-border transactions. For more details, consult the complete report.

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