The European Association for Secure Transactions (East) is reporting a sharp rise in ‘jackpotting’ Black Box attacks on European ATMs in the first six months of 2020.
A Black Box attack is the connection of an unauthorised device which sends dispense commands directly to the ATM, in order to ‘cash-out’ or ‘jackpot’ the machine.
East says that ATM malware and logical attacks against cash machines were up 269% (from 35 to 129) and all the reported attacks were Black Box attacks. Related losses were up from less than €1,000, to just over €1 million.
Financial institutions had more success in clamping down on more established fraudulent activity. Terminal related fraud attacks were down 66% (from 10,723 to 3,631 incidents), card skimming fell to another all-time low (down from 731 to 321 incidents) and transaction reversal fraud (TRF) at ATMs decreased by 97% (down from 3,405 to just 108 incidents).
Total losses of €109 million were reported, down 12% from the €124 million reported during the same period in 2019.
Brute force physical attacks on machines were down 23% (from 2,376 to 1,829 incidents). Attacks due to ram raids and ATM burglary were down 34% (from 610 to 405 incidents) and ATM explosive attacks (including explosive gas and solid explosive attacks) were up 0.4% (from 503 to 505 incidents).
Losses due to ATM related physical attacks were €12.6 million, an 11% increase from the €11.4 million reported during the same period in 2019. This increase was driven by a rise in losses due to explosive and gas attacks, which were up 49% from €5.1 million to €7.6 million.
Global Payments Revenue Forecast Down to $1.8trn Amid Pandemic
Annual global payments revenues could reach $1.8 trillion under a quick Covid-rebound scenario, according to data from the Boston Consulting Group, representing a considerable slowdown in growth from pre-pandemic boom times.
The consultancy’s annual Global Payments Report, compiled using data from Swift, includes three revenue growth scenarios based on global GDP development.
Under a quick-rebound scenario, BCG’s outlook suggests that the global payments revenue pool will expand from $1.5 trillion in 2019 to $1.8 trillion in 2024, a compound annual growth rate of 4.4 per cent. Although solid, this CAGR is much lower than the 7.3 per cent annual growth the industry enjoyed from 2014 to 2019.
In a slow-recovery scenario, the global revenue pool would reach $1.7 trillion by 2024, a CAGR of 2.7 per cent. Under a deeper-impact scenario, the revenue pool would grow by only a moderate CAGR of 1.1 per cent.
The second half of the decade, however, looks considerably brighter, driven by economic expansion, advancements in payments infrastructure, e-commerce growth, and greater financial inclusion.
From 2024 to 2029, global payments revenues should rise by 4.4 per cent to 5.6 per cent annually, states the consultancy, roughly 1.5 times faster than the growth of banking revenues overall. By 2029, the revenue pool could swell to between $1.9 trillion and $2.4 trillion, depending on the extent of the economic recovery.
“By accelerating changes that traditionally take a decade to materialise in the payments industry, the pandemic and its aftermath have created a window for the most talented companies to leapfrog the competition, gain scale, and deliver customer impact,” says Yann Sénant, a Paris-based BCG managing director and partner, co-author of the report, and global leader of the firm’s payments and transaction banking segment. “That ticking clock means that payments players that act decisively now will have a clear advantage over the rest of the field.”
ACI Worldwide and Mastercard Agree Collaboration Pact
ACI Worldwide, a leading global provider of real-time digital payment software and solutions, and Mastercard, the global multi-rail payments technology company, today announced that they will partner to provide a wide range of real-time payment solutions globally.
They will initially collaborate to offer best-in-class central infrastructure, payments localization and access solutions to central banks, scheme operators, financial institutions, payment service providers, and other organizations launching real-time payments initiatives.
The real-time account-to-account payments market continues to quickly expand. Prime Time for Real-Time — a recent study analysing global real-time, account-to-account payment volumes and forecasts across 30 global markets — projects a Compound Annual Growth Rate (CAGR) of 23.4 percent from 2019 to 2024.
While existing schemes around the world are adding new participants and value-added services, additional country and regional schemes are launching each year, including more than 20 schemes in varying planning stages.
With a complementary real-time payments vision, the combination of Mastercard’s central infrastructure and ACI’s payments access and real-time message transformation technology delivers an unmatched end-to-end offering. The new joint solution delivers key benefits including:
• Flexible deployment options — Mastercard and ACI collaboration provides deployment options that range from a fully managed service in the cloud, to supporting on-premise software for government, central bank and system operator-owned platforms
• Ability to support existing local market requirements — the joint solution reduces the amount of time to onboard participants and provides flexibility to accelerate real-time adoption
• ISO20022-first approach — joint real-time capabilities support organizations today and tomorrow, and provide translation to and from existing standards
• Digital services — further capabilities to support new digital services such as request to pay, proxy services and biller services
• Global proposition, local expertise —Mastercard and ACI collaboration brings together global reach, international experience and the local market knowledge
“With more countries and regions embarking on the modernisation of their payments systems to capitalise on real-time technologies and customer demand, the market opportunity is significant,” said Paul Stoddart, President of New Payment Platforms, Mastercard.
“Working together with ACI, we will explore a wide range of opportunities to accelerate the development and usage of real-time and multi-channel payment platforms, driving choice and innovation to market participants and end customers.”
“Mastercard and ACI share an extensive and complementary track record of real-time payments success — driving global central infrastructure clearing and settlement schemes, and this partnership creates the most robust and complete set of real-time capabilities in the market today,” said Craig Saks, Chief Strategy and Transformation Officer, ACI Worldwide.
“Our companies are the leaders in real-time payments and aligning on an end-to-end solution will provide great benefit not only to banks and central infrastructures, but to merchants, billers, fintechs and intermediaries — and their customers — as well.”
Mastercard is a leading provider of account-to-account and card payments technology globally, with markets including the US, UK and Singapore as real-time payment infrastructure customers. ACI currently supports 18 real-time domestic schemes around the world, including Zelle and TCH in the US. Approximately 50 percent of the UK’s Faster Payments (UKFP) and 75 percent of Hungary’s GIRO transactions are processed through UP Immediate Payments.
The solution is also the core processing infrastructure for Malaysia’s Real-Time Retail Payments Platform (RPP), and STET’s real-time payments platform for PSPs in Europe. Additionally, ACI has customers using UP Immediate Payments to access Singapore FAST and the Australian NPP (New Payments Platform).
Heritage Bank Tasks Auditors on Digital Technologies To Prevent Fraud
- $42bn lost to cybercrmess globally-PwC
Heritage Bank Plc has called on internal auditors of banks to adopt the various digital technologies to prevent fraud and annul the adverse impact of Covid-19 on the financial ecosystem.
Speaking at the just concluded 47th quarterly meeting of the Association of Chief Audit Executives of Banks in Nigeria (ACAEBIN), the MD/CEO of Heritage Bank, Ifie Sekibo, disclosed that, for improved banking operations and safer financial system for stakeholders, internal auditors must be dynamic and quick to adopt various digital measures.
Speaking on the alarming impact of fraudulent activities in the banking sector, Sekibo quoted PricewaterhouseCoopers’ (PWC’s) Global Economic Crime and Fraud Survey 2020, revealing that the total cost of cybercrimes is worth an eye-watering $42 billion, which was cash taken straight off companies’ bottom line, whilst 13 per cent of those who had experienced fraud said they had lost $50 million-plus.
Sekibo, who spoke on the theme, “Elevating Internal Audit’s Role in the Face of Emerging Risks and Opportunities” organised virtually and hosted by the Heritage Bank, said, “While it was sufficient for yesterday’s auditor to understand regular and routine banking practices such as credit, treasury, etc in his traditional assurance role, for him to be relevant in harnessing the opportunities in today’s business world, he must become versed in cybersecurity, artificial intelligence, data analytics, fraud management, regulatory pronouncements, forensics among others, and having equipped himself, present balanced, objective audit reports to Executive Management while striking the right balance between the assurance and consulting responsibilities.”
In her keynote address, titled, “Elevating Internal Audit Role In The Face Of Emerging Risks and Opportunities,”Partner, Risk Advisory at Deloitte, Ibukun Beecroft, noted that the banking industry in Nigeria today has adopted various digital measures to keep the business running and delivering services to the customers but that there was need for Internal Audit (IA) positioned to provide the required assurance and consulting services in the face of the changes and attendant risk, particularly increased cyber-risks.
Quoting 2018 Financial Stability Report by the Central Bank of Nigeria, she stated that Banks recorded 25,029 confirmed cases of fraud and this resulted in a loss of N2.21 billion. More than 90% of fraud cases in 2018 were perpetrated via technologically driven channels.
“As Internal Auditors, the knowledge of technology would enable us identify gaps in our core banking applications and other applications and provide relevant recommendations to eliminating loopholes that may serve as an avenue for potential fraud.
She, however, advised auditors on the need to focus on advanced technologies and risk management operations as reflected around the Three Lines of Defense (3LOD) churned out by the Institute of Internal Auditors, which create opportunities for IA and its future role.
Beecroft warned that the ever-changing landscape and evolving risks in the banking industry could render the current internal audit plan obsolete.
According to her, internal auditors should reprioritise the audit plan as soon as possible to provide assurance over the most consequential risks while being cognisant of the impact on operations.
“To take advantage of these changes and disruptions, auditors need to rethink their role by adapting to and embracing change, enabling the IA function to become more agile, nimble, and forward-looking, thus driving change through the 3LOD,” Beecroft stated.
Director, Internal Audit services at PricewaterhouseCoopers Limited (PWC), Yetunde Oladeji, who spoke on the theme, “Elevating IA’s role to meet today’s emerging risks,” advised that the banking sector should be dynamic, prioritse digitization and flexibible workforce strategies as these would determine its ability to adapt to rapidly changing circumstances to survive and thrive.
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