Consumers are increasingly comfortable with faking data when applying for credit, but still expect strong fraud protection from institutions
Global analytics software leader FICO has announced its findings from the 2025 FICO Consumer Survey: Fraud, Identity and Digital Banking South Africa, which show a rising trend in financial dishonesty among consumers under pressure. Twenty-six percent of South Africans say it’s acceptable in some circumstances to exaggerate income on a loan application, while 22% say inflating income for a mobile phone contract is considered normal.
This behaviour reflects increasing financial strain felt by consumers, but also raises concerns about the growing normalisation of first-party fraud – fraud committed by the consumer themselves, using their own identity – in the South African credit environment.
“Consumers are falsifying information in applications to gain credit, not understanding how much these loans could stretch their finances and risk leaving them unable to repay, or even facing the consequences of committing fraud,” said James Roche, principal consultant at FICO. “Banks are up against a constant challenge to prevent fraud and lend responsibly. While checks during applications may feel frustrating, they are there to protect the customer.”
Strong fraud protection drives bank selection
While some consumers are willing to misrepresent their financial circumstances to access credit, most still expect institutions to offer robust fraud protection when they are the potential victim. In fact, 25% of respondents ranked good fraud protection as their primary consideration when selecting a financial services provider, and two-thirds of respondents ranked it as one of their top three priorities.
This puts fraud protection ahead of traditional decision drivers such as value for money, rewards or brand familiarity. Ease of use came in as another top consideration for 27% of South Africans, indicating a growing need for simplicity and accessibility.
Growing acceptance of identity checks
Despite heightened awareness of digital risks, only 27% of South African consumers said they would abandon an application if identity checks were too time-consuming or difficult. This suggests that the majority are willing to undergo a more rigorous onboarding procedure if it meant they would be offered better protection.
Biometric authentication is one of South Africans’ preferred methods for securing online transactions and accounts. According to the survey, 65% of South Africans strongly prefer fingerprint verification while 60% say the same for facial recognition. By contrast, traditional passwords and PINs are losing consumer confidence. Iris scans, though less common, are considered highly secure by those familiar with them. Customers are opting into solutions that are seamlessly secure and are primarily app-driven.
The biggest fraud concerns remain centred on identity theft and deception. South Africans are concerned about being tricked into sending money and having their identity misused to open a financial account. While around 7% of respondents say their identity has already been used by a fraudster to open an account, the true figure may be higher given low awareness and detection.
Application fraud is personal
“South Africans’ expectations of their financial providers are higher than ever. This is about trust,” said Roche. “People want to know their data is safe, applications are being fairly evaluated and the systems in place are capable of distinguishing between legitimate use and criminal intent. This highlights a critical need for financial institutions to design identity verification journeys that are adaptive, intelligent and frictionless. Institutions need to invest in technologies and strategies that deliver speed without sacrificing accuracy or trust.”
Discover the latest trends and insights—explore the Business Insights Journal for up-to-date strategies and industry breakthroughs!
