Instant Payments and Banking Fraud in 2024: What Banks and Users Should Know

$17.3M have been invested into financial fraud prevention in 2024, says the newest report, while fraud numbers indicate that banks need to increase their security further while educating customers about fraud prevention. 

According to a recent report by RedCompass Labs, banks have invested $17.3 million in 2024 into technology and fraud prevention. The World Payments Report 2025 also discusses the need for better fraud detection strategies, particularly for e-commerce and instant payments. 

While banks are still falling behind criminals by 8.2 months on average, Mano Bank CEO Giedrė Blazgienė says that by focusing on the latest technology and educating their customers, banks can change this dynamics.

“As it is important for banks to continuously invest in financial crime detection and prevention, it is also important for those who do online payments to follow some simple rules to avoid fraudsters,” said Giedrė Blazgienė, a CEO at Mano Bank, a specialized bank based in Lithuania. “Although handy, instant payments are becoming a prime target for scammers. With technologies evolving and new threats of fraudulent activity rising, everyone must stay vigilant and up to date with the newest technologies. As the holidays are nearing, the amount of online fraud usually increases.”

Besides technologies, expanding human resources is also crucial for better detection of financial fraud, according to the expert at Mano Bank. Having teams of specialists who work in anti-money laundering can ensure fewer crimes are committed in the sector. 

“Lithuania has a large advantage in this regard, as over 10 thousand experts are working in the field of anti-money laundering,” says Blazgienė. “Instant payment systems, while incredibly fast, can give fraudsters an open door to exploit weaknesses. Therefore, businesses and banks can identify fraud more precisely by incorporating machine learning, which is a new method set to revolutionize hoax detection. Machine learning algorithms can go through big volumes of transaction data, flagging patterns and anomalies that indicate fraudulent activities. AI/ML-based suppression layers of protection help detect and block fraud with exact precision.”

Here are some of the most common types of instant payment fraud and ways to deal with it:

Phishing. People are scammed to reveal sensitive banking information while in the process of an instant payment, which is then used to initiate unauthorized real-time transactions. Fraudsters may use “phishing” through SMS messages or emails, or “quishing,” where QR codes in messages lead users to fake websites that capture sensitive data. It’s important to avoid clicking on suspicious links or providing banking details in response to unsolicited emails, text messages, or phone calls. According to Blazgienė, messages that request excessive information often signal a potential threat.

Account takeover. Account takeover can also happen during the instant payment process. Fraudsters can gain access to a user’s bank account details, often through hacking, which allows them to make unauthorized real-time transfers. Users must be very vigilant about their passwords, which must be strong, consisting of at least 14 characters, a combination of uppercase letters, lowercase letters, numbers, and symbols. 

A strong password can be a long, but easy-to-remember text with embedded characters – a favorite phrase, a fragment of a poem or another longer sentence consisting of a sufficiently long sequence of characters. For example, it can be a famous person’s phrase “.well.done,Ist.bet2ter.than.well,Said” (Benjamin Franklin’s phrase). Users should avoid reusing passwords across different accounts, especially for sensitive ones like banking or email. Additionally, it is recommended to refrain from accessing financial accounts on public Wi-Fi networks, which are more susceptible to interception.

Malware. Malicious software can be used to infiltrate banking systems, intercepting or altering payment instructions. Users should be taught to always install software updates, and to never install files received by SMS or email links. They should be careful not to disable the built-in systems of their computers that usually prevent installing apps from unknown sources.

Identity theft. Fraudsters can steal personal information to impersonate someone and set up new accounts; they can take over existing accounts to steal money. Users should always use unique login credentials across different bank accounts, and enable multifactor or biometric authentication. They should be taught to never click on links or download attachments from unsolicited emails—they should go directly to the bank’s legitimate website by typing its address into the web browser.

Transaction manipulation. In this case, transaction details or amounts can be manipulated in real-time, exploiting vulnerabilities in the payment processing system – therefore, it is important to do one’s banking with a trustworthy bank that is known for strong anti-fraud technology and has user credibility.

“Second-guessing suspicious details should be at the top of the mind of everyone using online banking,” said Blazgienė. “Even the most technologically advanced preemptive measures may become ineffective if consumers do not take time to question unusual online behavior.”