It’s Not Just You, Small Business Lending Fraud Really is On The Rise
LexisNexis Risk Solutions recently conducted a small business lending fraud study that observed a significant increase over the last two years. According to the study, lending fraud grew by 14.5% since 2021. Fintech and digital lenders experienced the greatest increase in fraud at 16.5%. While fraud against smaller banks, large banks, and credit unions remains high, fintech and digital lenders suffered the most as a percentage of revenue at 7%
Remote channels, which comprise mostly of online and mobile, continue to be the primary driving force of fraud-related losses. Sixty-four percent of lenders have reported altering their approach to remote channel fraud detection and mitigation.
The increase in fraud is just another challenge that the industry must find a solution for. And while the expectation for fraud to rise persists, plans to boost investments in fraud prevention are also set to increase. Expanding staffing on fraud teams, special fraud prevention initiatives, and increasing spend on vendor solutions are three options SMBs can use to address it, according to the study.Last modified: May 3, 2023
Anaya Vance is a reporter for deBanked. Connect with me on LinkedIn.