The increasing demand for credit is attracting fraudsters, suggesting proactive and reactive measures to protect valuable information and money.

The latest crime statistics from the South African Banking Risk Information Centre reveal a complex financial fraud landscape.

Criminals are enhancing their attacks, with card fraud decreasing by 18.4% and digital banking fraud increasing by 36%, resulting in a 9% increase in financial losses an incident.

Leon Jacobs, the chief information officer at RCS, highlights the significant shift in financial fraud due to the adoption of digital transactions.

“As a retail consumer finance provider, we’ve put measures in place to protect customers from falling prey to fraudulent tactics.

“In addition to this, we have ramped up our efforts to empower South Africans with the knowledge they need to protect themselves both in terms of their cards and passwords, as well as their online behaviour.

“Our security efforts plus greater awareness from customers results in an airtight system that can stop fraudsters in their tracks,” Jacobs said.

He said that the important part of making credit work for you involved getting smart about financial crime.

That involved taking a few simple steps that could make a big difference in terms of preventing unnecessary financial losses, hassle and emotional distress.

Focusing specifically on what to do to avoid being defrauded when using credit or applying for a loan, Jacobs suggested the following safeguards:

Stay in the safe zone when applying for a loan.

The latest loan scam involves inviting you to apply for a loan and asking for an advance fee. The fraudster takes your money, and you never receive the loan amount. To avoid the scam, you can take the following steps:

Do these 3 important checks:

1. The domain: The email domain should be from the company making the offer. Avoid any unsolicited offers from a Gmail, Yahoo or Outlook address.

2. The number: If the offer reaches you via SMS or a call from a personal number rather than a call centre, it is problems fake.

3. The language: Look out for spelling errors and bad grammar, even if the offer contains the company’s logo and looks legitimate.

Beware of these 3 red flags:

1. An undue sense of urgency: Fraudsters will often try to pressurise or scare you into making a decision without really thinking it through properly.

2. An upfront fee to secure the loan: legitimate credit providers will never ask for an advance fee.

3. Lack of background checks: Legitimate credit providers will always comply with the National Credit Act and do the relevant checks before approving any loan — this is for your safety as well as theirs.

The Star