CTOS IDGuard has screened more than 18 million credit applications and flagged RM1.08 billion in potential fraud as digital lending grows in Malaysia.
The fraud prevention system, which CTOS says is used by most Malaysian banks, has identified suspected and confirmed application fraud cases since its launch in September 2020.
The flagged amounts were detected before disbursement, helping member banks reduce potential credit losses as more applications move through digital channels.
In the 12 months to 30 April 2026, IDGuard screened more than 4.3 million applications and flagged an estimated RM276 million in potential application credit fraud.
The figures reflect the faster pace of fraud detection across Malaysia’s banking sector as digital banks, e-wallets, embedded financing and online credit onboarding expand access to credit.
CTOS also cited growing consumer concern over financial crime, with 28% of Malaysians ranking fraud protection as their top consideration when choosing a bank.
Another 33% identified money transfer scams as their main financial crime concern.
“CTOS IDGuard flagging more than RM1 billion potential application fraud reflects both the rising sophistication of fraud and the industry’s growing commitment to proactive risk prevention.
By working together and sharing intelligence responsibly, banks can build a stronger collective defence against financial crime,”
said Ankur Sehgal, Group CEO of CTOS Digital Berhad.
Mortgages Record Highest Fraud Alert Rate
IDGuard’s data showed that fraud risk varied across credit products.
Mortgages recorded the highest fraud alert rate at 3.35%, followed by personal loans at 1.91% and auto loans at 1.87%.
Card portfolios had the highest application volumes but recorded a lower alert rate of 0.96%, suggesting that higher volume does not necessarily mean higher fraud concentration.
CTOS plans to enhance IDGuard with real-time monitoring features so participating banks can receive near real-time alerts when their customers are flagged for application fraud by another bank.
Ankur added that consumers are placing greater emphasis on trust and security when choosing financial institutions.
“Our role is to support every participating bank in delivering on that expectation, helping detect fraud at the application stage, before it becomes a financial loss.
As we continue to enhance our monitoring capabilities, we are building a more proactive fraud prevention infrastructure, one that strengthens the resilience of the financial system while protecting the Malaysians who rely on it,”
he said.
Featured image: Edited by Fintech News Malaysia, based on image by smartmalik6384 via Magnific
