Real-Time Payment Fraud: Instant Settlement Risks.

The report explores the vulnerabilities in real-time payment systems that lead to an increase in payment fraud. With the global adoption of platforms like UPI, FedNow, and SEPA Instant, the speed of transactions limits the ability to detect fraud before settlement. Key findings indicate that scams, particularly Authorized Push Payment (APP) fraud, are a major occurrence due to rapid laundering and minimal reversal options. The report also highlights the role of AI in fraud execution and the challenges faced by financial institutions in implementing effective controls. Regulatory responses and liability frameworks are discussed as means to combat these challenges.