The Rise of Payment Fraud and What Comes Next

Cybercrime in the payments industry is accelerating. As digital commerce expands, fraudsters are using more advanced tactics to bypass security systems. From ransomware to card-not-present fraud, the threats are increasing in both volume and sophistication.

Visa’s Biannual Threats Report shows ransomware attacks jumped 91 percent in March 2025 compared to February. Card-not-present fraud now accounts for 58 percent of all fraud and breach investigations.

‍

Card-Not-Present and Retail Fraud Are Growing

E-commerce merchants face the highest volume of fraud activity. Online businesses were involved in over half of all breach investigations, while brick-and-mortar retailers still made up 20 percent of the total.

Visa also reported an increase in spoofed merchants, fake websites, malicious ads, flash-fraud scams, and deceptive giveaway schemes that harvest payment data.

‍

AI Is Lowering the Barrier for Criminals

New AI tools are helping fraudsters scale faster. Language models like ChatGPT are being used to create malware that can steal files, encrypt devices, or evade detection.

These tools allow attackers with little technical knowledge to launch sophisticated scams. Visa identified exploited vulnerabilities and compromised credentials as the top causes behind ransomware attacks.

‍

Payment Platforms Are Facing Pressure

Peer-to-peer services like Zelle are drawing criticism from both consumers and lawmakers. Although fraud cases make up less than 1 percent of Zelle’s total transactions, the platform’s scale has made it a frequent target for scams.

Card-present fraud is also reemerging. Visa has detected more skimming devices being used to steal data at physical terminals.

‍

Industry Is Responding With New Tools

Technology companies are investing in biometric authentication, passkeys, and contactless payment security. The FIDO Alliance and EMVCo are driving adoption of stronger authentication methods and international security standards.

While promising, these solutions require user adoption to be effective. In the U.S., consumer willingness to adopt new authentication tools remains low.

‍

Proactive Security Is Now Critical

Visa reports it blocked 30 billion dollars in fraud in just six months. But blocking fraud is not enough. The industry must stay ahead by improving education, updating standards, and simplifying secure transactions.

Kubera Payments is committed to building safer systems. We continue to support our partners by staying informed, implementing best practices, and focusing on security at every stage of the payment process.

‍