A new global study has exposed a growing crisis of confidence in banks’ ability to protect their customers from fraud. Conducted by Jumio, a leader in AI-driven identity verification and fraud detection, the research surveyed over 8,000 consumers across the United Kingdom, United States, Singapore, and Mexico. The results paint a stark picture: a staggering 78% of Singaporean consumers say they are willing to switch banks if they feel that fraud protection measures are inadequate. This figure is even higher than the global average of 75%, highlighting a sharp rise in concerns around cybersecurity and online fraud.

The findings reveal a fundamental shift in how consumers perceive their financial institutions. No longer is it enough for a bank to offer seamless digital services, competitive rates, or even excellent customer service. Instead, the ability to safeguard personal and financial data is becoming one of the most critical factors in whether a customer stays loyal or walks away. The modern banking customer, now more digitally connected than ever, expects a level of security that matches the sophistication of the threats they face.

A New Era of Fraud: AI-Powered Scams and the Rise of Deepfakes

Banks have long had to deal with impersonation fraud and phishing scams, but the landscape is evolving at an alarming pace. The rapid advancements in artificial intelligence, particularly in deepfake technology and voice cloning, have given cybercriminals a powerful new arsenal. These technologies make it possible for scammers to convincingly imitate a person’s voice, appearance, or even real-time facial movements, making traditional fraud detection methods increasingly ineffective.

With 78% of Singaporean consumers expressing concern about deepfake-powered fraud, it is clear that the anxiety around these emerging threats is particularly acute in this market. This level of concern surpasses the global average of 67%, signaling that consumers in Singapore are more acutely aware of the risks and expect banks to step up their defenses.

Fraud schemes that rely on AI-driven deception are no longer limited to isolated incidents or high-profile corporate breaches. Increasingly, everyday consumers are being targeted through tactics that play on their emotions—scammers pose as distressed family members in need of urgent financial assistance, impersonate bank representatives, or even use deepfake videos as clickbait to lure people into providing their banking credentials.

Consumers Expect More—and They’re Ready to Walk Away

Perhaps the most significant takeaway from the study is that customers overwhelmingly hold banks responsible for protecting them from fraud. Three out of four respondents (75%) believe that their financial service provider bears the ultimate responsibility for keeping them safe from cybercrime. This expectation creates enormous pressure on banks to invest in cutting-edge security measures—or risk losing customers to competitors that do.

The research also highlights that consumers are not only expecting better fraud protection—they are demanding compensation when things go wrong. A full 75% of respondents stated that they expect their bank to fully reimburse them in the event they fall victim to cybercrime. This expectation is likely to put additional pressure on financial institutions, especially as regulators may begin mandating stricter consumer protection policies around fraud reimbursement.

Singaporean consumers, in particular, are vocal in their expectations. A significant 74% are calling for stronger cybersecurity measures, compared to a global average of 69%. This demand for greater security is not just about personal concerns—it reflects a broader awareness of how advanced cybercriminal techniques have become, and the urgent need for institutions to respond.

How Banks Can Regain Trust: Fighting AI with AI

The findings of the Jumio study serve as a wake-up call for banks and financial institutions worldwide. As cybercriminals continue to refine their tactics, banks must embrace new technological defenses that match the sophistication of emerging threats.

One of the most effective ways to combat deepfake-powered fraud is through the adoption of biometric-based authentication. Unlike traditional password-based security, which can be easily stolen or replicated, biometric verification uses facial recognition, fingerprint scanning, and voice analysis to verify a user’s identity. To stay ahead of fraudsters, banks must implement multimodal biometric verification that incorporates liveness detection—a technology designed to distinguish real users from deepfake impersonations or spoofed biometric data.

Additionally, financial institutions should invest in AI-powered fraud detection systems capable of identifying suspicious behavioral patterns in real-time. These systems can flag anomalies, such as unusual login locations, rapid transaction activity, or inconsistencies in user behavior, helping banks to intervene before fraud occurs.

The Future of Banking: Cybersecurity as a Competitive Advantage

We are entering an era where cybersecurity is no longer just a compliance requirement—it is a key differentiator for banks. The institutions that proactively enhance their fraud prevention strategies will gain a decisive competitive edge, while those that fail to do so risk losing their customers to more security-conscious competitors.

Moreover, financial regulators worldwide are paying close attention to how banks handle fraud prevention and reimbursement. With more consumers expecting full compensation when they fall victim to scams, governments may soon introduce stricter liability rules for financial institutions. Banks that fail to prepare for this shift may find themselves facing not only financial losses but also regulatory penalties and reputational damage.

The Jumio 2024 Online Identity Study makes one thing abundantly clear: consumer trust in banking security is declining, and institutions that do not prioritize fraud prevention will suffer the consequences. As digital threats grow more complex, so too must the defenses against them. The future of banking will belong to those who recognize that trust is now their most valuable currency.