Last year, Brazilian banks lost half a billion dollars to electronic fraud, according to the latest figures from the Brazilian Banks Federation (Febraban). Febraban plans to disclose full details at its CIAB 2012 event next month, but clearly, electronic fraud is a growing concern. Indeed, that figure is a 30% increase from 2010 losses.
What’s causing this? In large part, it’s due to fraudsters exploiting the rapid increase of electronic transactions in Brazil. Of the 66.4 billion banking transactions in 2011, 15.7 billion were through internet banking, a 20% increase from 2010. And with the increasing proliferation of smartphones among Brazilian consumers, mobile banking grew by 49%, reaching 3.3 million users.
Even as Brazilian banks aim to capitalize on the growth in electronic banking, they appear to recognize the need to temper it with sound antifraud technology. Banks are investing more and more in IT, focusing on both fraud prevention and expanding financial services access to more consumers, such as by enabling internet and mobile transactions. According to the latest survey by Febraban, the top 16 banks (which represent 90% of assets) spent US$ 9 billion in IT in 2011, 11% more than in 2010. Furthermore, Febraban projects this IT spending will expand even further through 2015, by a hefty 42%.