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Co v er St o r y

more vertically focused financial services, retail and hos- Mark Brady, vice president, emerging product at AU10TIX,
pitality customer experiences. agreed that digital identity verification (IDV) needs to be
interoperable across regions. Looking ahead, he expects to
"This trend is amplified as more software companies own see more experimentation and collaboration among IDV
the payment processing embedded into their offerings," service providers. "There are many different regional or
he said. "Consequently, this evolution poses a challenge professional standards out there, and we need to figure
for non-tech-based ISOs and agents, as they struggle to out how they can coexist together and be accepted univer-
compete with businesses that have seamlessly incorpo- sally," he said.
rated payments and fintech services into their software
platforms." For Friedman, these incompatibilities among standards
and regulatory hurdles placed by governments on verify-
In an August 2023 Datos Insights study, Embedded Pay- ing credentials make it difficult for local and cross-border
ments: The Next Step in the Evolution of Payments, author IDV providers to identify people, but make it easier for
Thad Peterson positioned embedded commerce as an evo- criminals to attack infrastructures at scale.
lutionary milestone for payments.
"In 2024, we will see the first attempts to break into digital
"While powerful, the complexity of the payment ecosys- wallets," he said. "We have already heard talk about fraud-
tem creates challenges for implementation, particularly sters either breaking into mobiles to change them, or cre-
in cross-border scenarios," he wrote. "Merchants and the ating a new type of fake—the faking of QR codes that can
processors that serve them should develop friction mini- be used to get data out of the wallet."
mization strategies and tools that include an embedded
payments solution." Stealth-mode fraud

Cross-border expansion David Mouatt, vice president, SOC operations at Arkose
Labs, expects to see a plethora of volumetric attacks in
Carly Furman, CEO of Nayax North America LLC, pre- 2024, many of which will be difficult to detect. "It's going
dicts cross-border payments will continue to scale in 2024, to be a tumultuous, unpredictable year, as generative AI
stating, "With the globalization of business and increased comes into its own in the security world and cybercrime-
international transactions, there may be a focus on im- as-a-service empowers more rookie and novice attackers
proving cross-border payment systems to make them to use bots and human fraud farms to steal money from
more efficient and cost-effective." consumers' online accounts," he said. "We're at a moment
of time where many things are changing, and payments
In January 2023, Juniper Research projected $40 trillion companies need to be agile."
in global B2B cross-border payments by the end of 2024,
largely driven by ecommerce marketplaces and their in- Prepare now for a revival of social engineering attacks,
ternational shoppers. Noting that global cross-border pay- Mouatt added. Generative AI will continue to reshape
ments have been difficult to track across the globe, Nick phishing and in-product chat abuse. Its ability to write
Maynard, co-author of B2B Payments Market Research, pristine emails, mimic real voices and create realistic im-
remarked that cross-border payments are becoming more ages will make it harder to determine who is human and
agile and interoperable. what's a bot.

"While cross-border instant payments are not yet wide- Citing an Arkose Labs study, Mouatt noted that in 2023,
spread, only accounting for 8% of cross-border trans- bot-driven payment attacks increased by 30 percent in
actions by value globally in 2024, significant progress the second quarter, compared to the first quarter, and by
is being made in linking up national instant payment 19 percent in the third quarter, compared to the second
schemes," he said in a statement. "This can unlock sub- quarter. The gift card sector was particularly hard hit, he
stantial improvements for B2B transactions. B2B payment added, with a 7,319 percent increase in the third quarter
vendors must be driving further integration of the instant over the second quarter.
payment rails they support on a national level to solve the
difficult challenges with legacy payment channels." Mouatt urged security teams to mitigate fraud by leverag-
ing AI, which he called an accelerant for cybercrime and
Cross-border risk and fraud cybersecurity. As cybercrime-as-a-service puts off-the-

Ofer Friedman, chief business development officer at AU- shelf, ready-made bots in the hands of novices, AI and
10TIX, stated that disparate digital identity standards fur- other advanced technologies can help stem sophisticated
ther complicate a fragmented global payments landscape. attacks that can be launched without expertise or coding,
Apple and Google, for example, design digital wallets that he noted.
are compatible with the mDL standard, he stated, while
others build on other digital credentials, such as W3C, a Swipesum's Seaman has seen industry leaders leverage
proprietary Australian standard and eIDAS, which is pop- AI to detect and prevent fraud in real time and expects
ular in Europe. this trend to intensify in the coming year. "As fraudsters
become more sophisticated, leveraging tools like AI, we
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