While at the eCommerce Summit & Expo in Mexico City recently, the ThreatMetrix team presented the latest Cybercrime Report content, with a particular focus on the Latin American (LATAM) region. The report highlights that there was a 20% increase in attacks from LATAM in Q2 2018, compared to the previous year. Additionally, it reveals that Brazil is the country from where most attacks originate within the region.
The growth of mobile was also evident in LATAM as every 4 out of 10 transactions from the region are currently coming from a mobile device. The rate is higher in Mexico with 5 out of 10 transactions coming from mobile. Itâ€™s important to note that in Latin America some users skip desktop completely and perform all online transactions via mobile only. Banks and business are transitioning accordingly. For example, Brazilâ€™s oldest bank, Banco do Brasil recently started offering financial transactions via WhatsApp.
Rising Attacks on Financial Institutions
An area of concern in Latin America is the rate of attacks on financial institutions. Attacks in LATAM on financial institutions grew 19% quarter over quarter. This increase in attacks may rise further still as financial services grow alongside the acceleration of investments in fintech.
In Latin America it is estimated that there are over 1,000 fintech companies, and in Brazil the number of fintechs grew from 50 to 244 between 2015 and 2017. According to EY Financial Services, over $US 300m has been invested in this industry so far. Goldman Sachs estimates that Brazilâ€™s fintech companies will generate revenues of around US$25b over the next 10 years.
Growth of eCommerce…And Cybercrime
Attack rates in LATAM in general are significantly elevated compared to the rest of the world, which is a trend we have been tracking since the beginning of 2018. As stolen identity data circulates freely around the world in the wake of major data breaches, we have seen evidence of attacks on global American-based ecommerce giants originating from South America. Developing economies in general have become major perpetrators of fraud on organizations in more advanced digital economies such as the United States.
It will be interesting to see how the landscape develops in LATAM alongside the rapid growth of digital commerce in the region. Per comScore, eCommerce in Mexico grew 28% YoY in their 2017 study. Brazil is the largest digital economy in LATAM accounting for one-third of all retails sales in the region and is projected to grow 12% in 2018 compared to 8% last year. Total ecommerce sales in the region are projected to grow 18% to $53 billion in the next few years.
As the region fully embraces digital channels, LATAM businessesâ€™ ability to grow securely and at pace relies on savvy technology investments that enable their businesses to deploy automated approaches for assessing each and every transaction and customer interaction in real-time to differentiate between fraudsters and legitimate customers. This way, we will be able to keep the rising fraud levels at bay and guarantee a profitable digital future in Latin America.
EY Financial Services, January 2018 â€“ Lessons to be learned from Fin Tech adoption in Brazil
Estudio Comercio Electonico en Mexico 2017, comScore
Future Digital Global, International Edition 2018, comScore
ZDNet, Brazil Tech, â€œBanco do Brasil launches financial transactions via WhatsAppâ€�, October 12, 2018
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