South Africa recorded the highest rate of suspected digital fraud among the African countries analyzed in 2025, with 3.0% of transactions involving consumers flagged as potentially fraudulent. This figure is slightly lower than the global average of 3.8%, according to TransUnion H1 2026 Update: Top Fraud Trends Report.
While the suspected fraud rate dropped to 4.3% in 2024, the report cautions that this does not necessarily indicate a reduction in criminal activity. Instead, it suggests a shift towards more sophisticated, AI-enabled fraud techniques designed to increase accuracy, scale and success rates.
Fraud losses remain high but lag globally
The average fraud loss among South African consumers who experienced digital fraud last year was R11,055. This is the second highest in Africa after Kenya, but well below the global average of R27,879.
The findings point to an increasingly complex fraud environment where criminals are using more targeted and coordinated methods across email, online platforms, phone calls and SMS channels.
AI and trust-based attacks reshape the fraud landscape
According to the report, generic AI is playing a growing role in enabling fraudsters to carry out more concerted and scalable attacks. Criminals are no longer relying solely on traditional phishing or scam messages, but are embedding themselves in trusted digital environments.
One of the most shocking findings is that 33% of South African consumers who lost money to digital fraud reported being targeted through third-party seller scams on legitimate ecommerce platforms. This suggests that fraud is increasingly occurring in trusted ecosystems rather than in obvious or suspicious environments.
“Criminals are exploiting established trust and verified digital relationships,” said TransUnion Africa fraud expert Amrita Reddy, noting that this marks a shift away from global patterns dominated by phishing and vishing attacks.
Account takeover has emerged as a major fraud battlefield
South Africa is also unusual in that most suspected fraud occurs at the account login stage. In 2025, 3.0% of login attempts were flagged as potentially fraudulent, compared to 2.4% during account creation and only 0.7% during financial transactions.
This indicates a stronger focus on account takeover attacks using compromised credentials, SIM swaps and social engineering rather than the creation of fake accounts.
Reddy said fraud prevention strategies should extend beyond onboarding and cover the entire customer lifecycle.
Government services among top fraud targets
Fraud patterns also vary significantly by region. In South Africa, government-related transactions recorded the highest suspected fraud rate at 12.5%, followed by gaming at 11.5% and insurance at 7.8%.
The report highlights that digitization of public services, while improving accessibility, has also created new opportunities for impersonation and fraud.
“Fraudsters are taking advantage of official branding and service messages to impersonate the state,” Reddy said.
Security becomes a key driver of consumer trust
Consumer expectations are also shaping fraud prevention priorities. The survey found that 85% of South African consumers consider data security the most important factor when choosing with whom to transact online.
Ease of payments and simplified application processes were closely followed, but the findings reinforce that consumers are willing to accept some friction if it improves security and trust.
A more advanced and adaptive fraud era
The report concludes that South Africa has entered a more advanced fraud stage, where criminals increasingly exploit trust, operate across multiple channels and target established digital relationships.
As AI continues to accelerate fraud sophistication, both consumers and businesses are urged to invest in strengthening identity protection, adopting adaptive authentication, and continuous fraud detection throughout the entire digital journey.
//staff Writer