A recent study by BioCatch has shown that fraud losses are on the rise in German banking, with half of the country’s fraud and compliance team leaders reporting an increase in such incidents.
The US-based fraud prevention technology company disclosed its survey findings on February 11, 2026. Among the respondents, 65% of those working within the fraud departments and 67% of C-suite executives acknowledged a rise in fraudulent activities. Moreover, 66% estimated that their bank’s annual fraud losses surpass $10 million.
Surveyed German banking professionals indicated that implementing real-time SEPA payments in 2025 may have contributed to an uptick in fraud risk. The Single Euro Payments Area Instant Credit Transfer regulation mandates that all eurozone payment service providers offer instant transfers with settlement within seconds.
Investment in Fraud Controls Despite Confidence
While nearly three-quarters of the participants expressed confidence in the effectiveness of current fraud prevention measures, 76% of German banking leaders revealed that their institution is considering upgrading these controls. Among them, 11% have already initiated procurement and implementation processes.
According to Thomas Peacock, Director of Global Fraud Intelligence at BioCatch, the increase in fraud observed may be partly attributed to new legislative requirements, including the real-time SEPA payment regulation.
Mathias Schollmeyer, Country Manager for Germany at BioCatch, highlighted the persistent threat of fraud in German banks, emphasizing new vulnerabilities from the expansion of instant payments, the growing scale and precision enabled by accessible AI tools, and organized criminal networks exploiting any existing gaps in security.
Manual Review Processes Predominantly Used
German banking leaders reported manually reviewing a significant portion of fraud cases, significantly higher than the continental European average of 46%. Manual review processes entail human analysts assessing flagged transactions and customer activity to verify whether these are fraudulent.
Additionally, 36% of those surveyed in Germany stated that their bank currently compensates at least half of the customers who fall victim to scams. This figure is below European standards at 53%, as well as the global average of 44%. Three-quarters of respondents indicated that their bank has already taken proactive steps towards revising reimbursement policies in anticipation of new requirements under PSD3 and PSR.
Preparedness for AI-Driven Attacks
Regarding artificial intelligence, 84% of German banking leaders believe their institution is prepared to handle agentic AI attacks. Agentic AI involves autonomous systems capable of executing complex tasks and adapting their behavior based on outcomes with minimal human oversight.
German banks operate under regulatory obligations under the EU’s Anti-Money Laundering Directives, Payment Services Directive 2, and national financial supervision by BaFin.
