Lending money inherently comes with risks. And it gets even riskier when fraudsters join the party.
In this article, we’ll look at the most common methods fraudsters employ to commit loan fraud, and – importantly – how to protect your business from them.
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Digital Customer Onboarding Must Evolve
Deepfakes, massive data breaches, biometrics hacking… Fraudsters have no shortage of modern techniques designed to beat KYC checks. Fraudsters will continue to embrace new methods and technologies, so digital customer onboarding needs to evolve to account for this.
Online Loan Fraud Trends in 2023 and Beyond
Allied Market Research projects that the global digital lending market will grow from a value of $12.6 billion in 2022 to $71.8 billion by 2032. The market has already grown immensely, driven by the digital revolution and then shifts in lending patterns for small and medium businesses (SMBs) during the COVID-19 pandemic.
As the online lending market has evolved, so have loan fraud trends. Some of the latest trends to watch include:
Online Loan Fraud | The Method
FAQ
How do I check if someone took a loan in my name?
How to use SSN to get a loan?
What is a ghost loan?
What is loan fraud & how does it occur?
What is Loan Fraud and How Does it Occur? With payday loans, you may not know that someone has used your identity to illegally obtain cash. Thieves can open these types of loans in multiple states, racking up a huge debt using your personal information.
What should I do if I’m a victim of loan fraud?
There are several steps to take if you believe you’re a victim of loan fraud: Report the crime to your police or sheriff’s department. Although it’s not likely you’ll get your money back, you could help authorities track down the scammer if you have contact information.
What happens if a car loan is fraudulent?
In other cases, fraud claims are simply settled or even obscured by false claims of identity theft. In any case, we are talking about major monetary losses. Yet the consequences of undetected car loan fraud go beyond the immediate financial hit.
Is student loan fraud a real thing?
Federal student loan fraud rose by 188% between 2018 and 2019, representing the fastest-growing identity fraud type. Furthermore, it’s estimated that more than 10% of accounts considered bad debt by banks are actually fraudulent accounts. Complying with Know Your Customer (KYC) and anti-money laundering best practices reduces fraud risk.