ARTICLE
PSD3 and the PSR: why fraud prevention is becoming a real-time priority
For banks and payment providers, PSD3 and the Payment Services Regulation (PSR) are set to change more than reimbursement rules. They are pushing fraud prevention towards a model where PSPs need to take greater responsibility for stopping scams before money leaves the account.
That matters because the nature of fraud is changing. APP scams, impersonation and AI-enabled social engineering increasingly target the customer rather than the bank’s authentication controls. A customer can be using their own device, pass authentication and still be manipulated into making a fraudulent payment.
As discussed by fraud and payments leaders from Citi, Klarna, NatWest and NICE Actimize in our MoneyLIVE webinar, this means banks need to look beyond the transaction itself and understand what is happening across the customer’s journey.
From reimbursement to prevention
Greater reimbursement liability will put more pressure on PSPs to prevent fraud rather than simply manage losses afterwards.
But, as Jonathan Leslie of NatWest highlighted, reimbursement alone does not solve the underlying problem. The money is still reaching the criminal, while customers can lose trust even when they eventually get their money back.
The focus therefore needs to move further upstream – from recovering fraudulent payments to identifying the signals that suggest a customer is being targeted in the first place.
That starts with the wider customer journey. Onboarding should not be treated as a one-time check. Banks need to understand whether subsequent behaviour is consistent with what they know about the customer, particularly as criminals increasingly use compromised or synthetic identities.
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About NICE Actimize
As a global leader in artificial intelligence, platform services and cloud solutions, NICE Actimize excels in preventing fraud, detecting financial crime and supporting regulatory compliance. Over 1,000 organizations across more than 70 countries trust NICE Actimize to protect their institutions and safeguard assets throughout the entire customer lifecycle. With NICE Actimize, customers gain deeper insights and mitigate risks. Learn more at www.niceactimize.com.
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