According to a tech insider, the vast amount of data held by banks poses a major challenge to enhancing security measures, as Australians continue to suffer significant financial losses due to scams.

A leading tech company in Australia and New Zealand has highlighted the challenges faced by Australian banks in safeguarding customers from scams due to disorganised data. A tech company has implemented in-app prompts for the leading banks in New Zealand, a country known for its thriving entrepreneurial culture.

According to Atomic.io, Australian banks are struggling to improve their communication methods with customers due to complex internal data and systems. These obstacles are hindering the banks’ efforts to streamline and automate anti-scam measures. Atomic.io has recently initiated a project with one of the smaller Australian banks to address these issues.

According to Matty Sirois, the marketing head of Atomic.io, in-app communication provides a higher level of security for customers. As a result, Australian banks are at a disadvantage in the competition to adopt this more secure method of communication. Research commissioned by the company shows customers’ fear of scams is heightened by artificial intelligence.

“This report shows (banks) assume customers are stressed out by scams, but this report shows that they no longer trust and no longer can even recognise them as a scam or not because of the tech,” Sirois said.

“They no longer trust these … traditional channels: email, SMS and phone.

New data from the ACCC reveals that Australians fell victim to scams, losing a staggering $567 million in 2022, with a slightly lower amount of $476 million reported in the previous year.

“Behind every dollar lost to scams is a heartbreaking story – we are working hard to intercept these malicious criminals before they can inflict pain on innocent Australians,” Financial Services Minister Stephen Jones said in March.

Based in Wellington, Atomic.io has integrated action cards into the mobile applications of New Zealand’s leading banks. These interactive prompts appear to users, asking for confirmation or seeking their response to a variety of queries.

However, according to Sirois, the Australian banks face a significant challenge due to the growing population. This week, Westpac revealed its plans to streamline its internal systems, potentially reducing them from 180 to 60 at a cost of up to $2.8 billion.

“If you don’t have your data clean, you can’t do automation,” Sirois said.

“Clean” means no duplications or incorrect details in a bank’s gargantuan database.

In order to enhance security measures, banks are increasingly turning to automated in-app communication as a more secure alternative to email and SMS, which are susceptible to scams. Last week, Westpac unveiled a cutting-edge feature in their app that utilises artificial intelligence. This feature prompts users with a questionnaire whenever a potentially suspicious transaction occurs.

“The big banks … they’re using foundation steps. ANZ and CBA do some stuff in-app but not enough, they still rely on other channels,” Sirois said, though commended Westpac’s new feature, which his company had no hand in.

“I ignore anything that looks like it’s from (my bank) that is from a phone call or an email,” he said.

Last year, the ACCC received a significantly higher number of reports regarding text message and email phishing scams compared to phone call phishing. CommBank, ANZ, and Westpac emphasise the importance of not sharing sensitive information through links sent via email or text message.

However, the majority of New Zealand banks have discontinued the practice of sending web links through text messages. NAB discontinued links in text messages in mid-2023. Singaporean banks removed links in 2022. Artificial intelligence has become a powerful tool for scammers, enabling them to send out a constant stream of bank-impersonating emails and text messages.

According to Atomic.io, their platform enables the rapid development of action cards within a bank’s app, outpacing the banks themselves. ANZ and Westpac’s New Zealand branches, BNZ and Kiwi Bank, have adopted the firm’s technology, and according to Sirois, the company is currently engaged in preliminary discussions with one of the smaller Australian banks.

A recent study conducted on a sample of 1000 individuals from Australia and New Zealand, sponsored by Atomic.io, revealed that approximately one-third of the participants reported receiving a fraudulent email on a daily basis, while a majority of 64 percent encountered such emails at least once a week. According to the research, individuals who fell victim to scams showed a preference for using in-app messaging for further communication.

Justin Lance Marcel Lavadia

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Justin Lavadia is a content producer and editor at Public Spectrum with a diverse writing background spanning various niches and formats. With a wealth of experience, he brings clarity and concise communication to digital content. His expertise lies in crafting engaging content and delivering impactful narratives that resonate with readers.

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