KARACHI: Social engineering, which involves cybercriminals manipulating people into giving up confidential financial information, has become a “big and very significant trend” in the Pakistani market, according to Visa Inc, a global provider of rails for digital payments.

Speaking to Dawn on the sidelines of a recent security summit in Dubai, the company’s regional risk officer Charles Lobo said individuals and small businesses are falling prey to social engineering in increasing numbers in the South Asian country following a “seismic shift” in the way people transact in the post-pandemic world.

Visa issues “credentials” — payment IDs linked to bank accounts or mobile wallets — that enable secure transactions among financial institutions, merchants and consumers.

“There’s a whole new set of digital natives, people who’ve gone digital for the first time not out of choice but out of compulsion… (who) are vulnerable,” he said.

According to the 2022 Stay Secure Survey conducted by Visa on Pakistani consumers’ attitudes towards digital payments, data privacy and security were critical to 82 per cent of the participants. Similarly, knowing whether a merchant’s payment facility was secure remained the top priority for Pakistani consumers.

Pakistani consumers also prefer electronic payments with as many as 75pc of them stating they’d made a digital payment in the month before being surveyed. Four in every five consumers would switch merchants if their preferred payment method wasn’t offered, the research showed.

Mr Lobo said fraudsters have become “more digital” as old tricks like card skimming have given way to practices like enumeration — a technology-driven crime involving high computing power to guess and generate card numbers.

These numbers are then used to break into a financial institution’s infrastructure by pumping a huge volume of transactions at a high velocity.

“Enumeration is another trend that’s on the rise in the Pakistan market,” he said, adding that criminals now find little opportunity in the “simple, physical world” to do crime and have shifted their focus to digital fraud.

A total of 9.1 million e-commerce transactions amounting to Rs27 billion were conducted digitally in the January-March 2022 quarter, the latest three-month period for which payment data is available on the State Bank of Pakistan’s website. The figures translate to a quarterly decline of 32.7pc volume-wise and an increase of 1.3pc in terms of the value transacted, according to the central bank.

Mr Lobo said Visa uses artificial intelligence and machine learning tools to detect in real-time any flow of transactions that’s out of the ordinary. “It triggers an alarm. We’ve systems that’re looking for everything that’s out of the norm… Many a time we find the anomaly before the institution finds it. That’s the power of our network,” he said, drawing attention to 3.9bn cards that facilitate about 255bn transactions worth more than $14 trillion every year.

Published in Dawn, March 5th, 2023