FICO Survey: Half of Indonesians Believe It Is OK to Exaggerate Income on Loan Applications and Insurance Claims
Stretched finances due to higher cost-of-living push many to consider falsifying information
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Giving false information is considered acceptable by many
When asked about their attitudes to giving false information for financial or material gain - known in banking as first-party fraud - half of Indonesians supported these behaviors. Around 25 percent of respondents said there are circumstances when it’s OK to exaggerate income on a loan or mortgage application, while 15 percent thought it was normal to do so. The survey revealed similar proportions of consumers would exaggerate an insurance claim or add items to a claim.
“Our findings underline the importance of robust fraud prevention strategies in safeguarding customers’ interests and strengthening the bottom line,” said
This sentiment is consistent with Southeast Asian neighbors
The results indicate that banks in
“The rising costs of living and uncertain financial climate have driven some Indonesians to take drastic measures to obtain credit and other means to make ends meet,” said Leo. “However, misrepresenting information constitutes fraud. By enhancing their ability to identify overstated or false information, financial institutions can proactively protect themselves against losses caused by customers' defaulting on repayments. In doing so, they can also support customers in avoiding regrettable outcomes.”
Fully leveraging data and analytics to drive fraud protection
Financial institutions frequently possess the evidence required to distinguish between fraudulent and legitimate applications. However, fraud teams are frequently unable to utilize this data because it is siloed. These inefficiencies result in inadequate fraud protection and compromise the customer experience. Banks prompt customers with arduous and time-consuming identity checks, resulting in increased costs and duplications that cause frustration for customers.
“In a highly competitive banking industry, a flawed fraud strategy can prove to be expensive,” said Leo. “A fraud team’s success hinges on balancing between strong protection and fulfilling the genuine needs of customers. With a holistic approach to an applicant’s data, fraud teams will be able to better separate fraudulent applications from legitimate ones. The application of analytics and machine learning models will further bolster a bank’s defenses while generating higher levels of customer satisfaction.”
Conducted in late 2022, the report surveyed 1,000 people each in 14 countries:
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