Identity fraud costs firms USD $7 million annually worldwide

A new study by Docusign and Entrust has revealed that identity fraud is costing businesses around the world an average of USD $7 million annually, with companies in Asia Pacific facing increasing risks from sophisticated attacks.

The report, titled "The Future of Global Identity Verification," surveyed over 1,400 global business leaders, including respondents from across the Asia Pacific region. It found that 69% of organisations worldwide have experienced a rise in identity fraud attempts over the past two years, contributing to higher annual losses through chargebacks, remediation, and damage to brand reputation. In local terms, the average annual loss now stands at SGD $9.3 million per business.

Recent events in Singapore have underscored the growing threat, with headline cases such as a finance director nearly losing SGD $670,000 to a scammer using deepfake video calls, and a 55 million dollar document forgery scandal at a Singapore-based family office. Globally, deepfake attacks are now reported to occur every five minutes, and incidents of digital document forgery have risen by 244%, according to data cited in the report.

For businesses in Asia Pacific, the top three identity fraud threats identified are identity theft, account creation fraud, and digital document forgeries. These tactics often target the initial stages of customer onboarding and document verification, where companies are under pressure to detect fraud while maintaining a smooth user experience. The study found that 80% of APAC organisations acknowledge a tension between strong fraud prevention and a seamless customer journey, the highest proportion among the regions surveyed.

Kartik Krishnamurthy, Vice-President, Asia at Docusign, commented on the balance organisations must strike: "As identity fraud escalates, enterprises are increasingly pressured to strike the right balance between security and seamless user experiences. This global study reinforces a critical truth: stronger security doesn't have to come at the cost of customer experience—in fact, it enhances it."

He further stated, "By implementing intelligent, low-friction security measures that are part of the Docusign ID Verification portfolio, businesses can create the right balance between building trust, protecting customers, and driving long-term engagement in an increasingly digital world."

The impact of identity fraud is particularly acute in the financial services and retail sectors. In banking and finance, firms reported the highest costs associated with direct losses from identity fraud, primarily during account creation and payment authorisation stages where gaps in verification processes are most often exploited. According to the study, 51% of financial services respondents globally said their organisations face annual fraud losses exceeding USD $1 million.

In the retail and e-commerce sectors, fraud most frequently occurs at checkout or during refund and chargeback stages, often after transactions are complete. These sectors face the challenge of balancing the need for fast and convenient digital transactions with effective security, highlighting the importance of early fraud detection solutions. Digital trust, the report noted, is increasingly a key factor in customer loyalty and conversion rates for retailers.

The study also illustrated the rise in sophistication of fraud techniques. Attacks using basic authentication methods such as usernames and passwords are more prevalent—cited by 51% of surveyed organisations—compared to only 21% of cases where more advanced verification like facial biometric liveness detection is used. This disparity demonstrates the value of more intelligent and adaptive security tools in combatting modern threats.

As the threat landscape evolves, investment in identity verification (IDV) technologies is growing. However, the report found 58% of organisations are concerned that implementing stricter controls might have a negative impact on user experience. Despite this, 70% believe technology is the most effective approach to limit identity fraud, while nearly three quarters reported plans to increase their spend on IDV solutions.

Tony Ball, President of Payments & Identity at Entrust, said: "A misconception about fraud prevention is that stronger security comes at the cost of user experience. Modern IDV solutions and adaptive authentication enable them both. End-users can verify their identity with a quick biometric selfie, while fraud checks such as device recognition, AI-powered deepfake detection run in the background. Adaptive authentication completes the identity lifecycle security and further enhances security by adjusting requirements based on risk signals, ensuring protection without unnecessary friction."

The report highlighted tangible benefits for companies making significant investments in modern IDV technologies. Those organisations reported average savings of USD $8 million annually and were 2.2 times more likely to achieve cost savings, 1.7 times more likely to significantly reduce identity fraud, 2.7 times more likely to report outperformance of peers in fraud prevention, and 1.6 times more likely to see a positive impact on brand trust.

The findings indicate organisations are increasingly incorporating IDV tools into their wider security and customer experience strategies, with the aim of facilitating secure digital engagement, building customer trust, and effectively preventing fraud as new technologies and risks continue to emerge.