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UAE Faces Surge In APP Scam Losses: ACI Worldwide Projects $30M By 2028

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Authorized push payment (APP) scam losses in the UAE are escalating at an alarming rate, with 2024 losses expected to grow 43% year-on-year. ACI Worldwide’s Scamscope report, produced in collaboration with GlobalData, estimates these losses will soar to $30.3 million by 2028, marking a compound annual growth rate (CAGR) of 29.6% between 2023 and 2028.

APP scams, which manipulate individuals into transferring funds to fraudsters, exploit trust and often bypass traditional fraud detection systems. The report highlights that real-time payment platforms, while enhancing convenience, have also increased vulnerability to fraud. By 2028, 90% of APP scam losses in the UAE—approximately $26.8 million—are expected to occur through real-time payments, reflecting a staggering CAGR of 30.3%.

UAE’s Emerging Fraud Landscape

Though the UAE has the lowest APP scam losses among six major real-time payment markets (including the U.S., U.K., India, and Brazil), the country is experiencing a rise in sophisticated scams, particularly investment scams.

  • 29% of victims in the UAE fall prey to investment scams.
  • Nearly 20% are targeted by advance payment scams.

This trend mirrors similar developments in neighboring Middle Eastern countries like Saudi Arabia, where APP scam losses are projected to grow at a CAGR of 26% between 2022 and 2027.

Additionally, one in five UAE victims choose to end their relationship with their financial institution following a scam, emphasizing the need for improved fraud protection measures to maintain customer trust.

The Role of Real-Time Payments and AI in Scam Growth

The UAE’s government-backed real-time payments platform, Aani, has transformed the payment ecosystem, offering enhanced convenience for businesses and consumers. However, the rapid adoption of real-time payments has created new opportunities for fraudsters.

“The UAE government has demonstrated commendable vision in introducing its real-time payments platform, Aani. However, the concurrent rise of AI-driven financial crimes necessitates a paradigm shift in fraud strategies to stay ahead of evolving threats,” said Santhosh Rao, Senior Vice President, Sales – MEASA, ACI Worldwide.

Recommendations for Mitigating Fraud

To address the growing threat of APP scams, ACI Worldwide’s Scamscope report advocates for:

  1. AI-Driven Fraud Management Systems
    • Advanced AI tools can analyze transaction data in real time, flagging anomalies and detecting fraudulent activity.
  2. Cross-Border Collaboration
    • Coordinated efforts among financial institutions and regulators can enhance security measures.
  3. Consumer Education
    • Raising awareness about scams and teaching preventative measures will empower consumers against fraudsters.

Moving Towards a Safer Digital Economy

As the UAE progresses towards a cashless digital economy, combating APP scams will require proactive measures from financial institutions, consumers, and regulators. Enhanced fraud prevention systems, combined with public awareness initiatives, can help reduce financial losses and strengthen trust in digital payment systems.