Fraud is an intricate practice. The methods of criminals creative and meticulous, and the cost to companies and consumers staggering. In the UK, the fraud economy is thriving. It’s a growth industry. And it’s showing no signs of slowing down.

Last year, the Annual Fraud Indicator report revealed the total cost of losses to the UK economy to be a colossal £190 billion. To put that huge number into context: it represents more than the government’s combined spend on health and defence.

The best way to describe the current fraud problem: pervasive. A recent survey by professional services firm PricewaterhouseCoopers (PwC) highlighted that half of UK companies had fallen victim to fraud or economic crime in the past two years. Today, businesses are finding themselves fighting a surge of sophisticated attacks.

At the centre of fraud is technology. As technology advances, new forms of fraud emerge, and more robust security solutions are developed. It’s a double-edged sword. But businesses need to be aware of trends and predictions that will allow them to offer the best possible protection to their customers.

In the financial services sector, the struggle has been striking a balance between innovation and protection. So far, it’s something that many in the sector have failed to get right. A large part of this is due to increasing market and consumer pressures. In an age of hyper-globalisation, with industries undergoing rapid digital transformation, financial institutions are facing demands to increase the pace of delivery and provide an omnichannel experience.

Due to the rise of digital commerce and the proliferation of multiple-channels and payment types, there are more data transactions taking place than ever before. While this is a big benefit to businesses, it brings with it greater risk. An omnichannel environment creates a number of challenges when it comes to fraud management. The sheer number of avenues exposed at any one time can stretch security thin. For fraudsters, this makes it ripe for exploitation.

Yet, many institutions still rely upon disparate services and products that act in isolation of one another. This piecemeal approach is a hindrance. It makes it much more difficult to recognise certain types of fraud and leads to delays in decision-making.

The truth is that most legacy security systems and anti-fraud measures simply aren’t able to keep up with modern fraud attacks. They’re too wide in scope, complex in execution and high in velocity. So, the sector is now turning to technology in a bid to strengthen its efforts to fight fraud.

Automation has been the most widely adopted, so far. It’s able to reduce the burden on finance professionals, particularly when it comes to back-office processes, such as transaction and application processing, and audit compliance. It’s also a viable solution for assessing risk and limiting exposure to fraud. As a result, institutions are introducing everything from machine-learning platforms to robotic process automation (RPA), network analysis and artificial intelligence (AI).

The common theme among automation technologies is that they use algorithms to spot suspicious activity, detect patterns and predict outcomes in large data pools. Some of the more advanced platforms are even capable of assessing the anatomy of a fraudulent transaction. These solutions can draw inferences based on the information available, raise questions where the data is incomplete and produce audit trails (vital in such a heavily regulated industry).

But while we’ve seen a greater uptake of automation technology within financial services, questions remain. The sector has a history of being risk-adverse and sceptical of new technologies. And industry experts have queried whether institutions are using technology on the same scale to prevent fraud as fraudsters are to perpetrate it.

One of the biggest concerns to businesses, especially banks, has been the up-front cost of investing in these technologies – as well as how fast they can be implemented and how well they integrate with the existing infrastructure.

It’s fair to say that it’s a large-scale change for such a traditional industry. But to hesitate to modernise anti-fraud measures – and to defer investment in technology that’s designed to combat this problem – based on whether or not it complements the current system is short-sighted. When it comes to fighting fraud, the financial services sector must analyse the impact of technology trends and invest accordingly.

The default position from those within the sector should be: Sooner or later, we will succumb to a fraud attack. And businesses need solutions that are intelligent, efficient and provide actionable insights.

Fighting fraud across the omnichannel is a difficult task. In the digital era, automation technology is vital. If the financial services sector is to lessen its exposure to fraudulent practices, and provide greater protection to its customers, then it must think strategically. At present, the sector finds itself locked in a technological arms race with fraudsters. Institutions need fast-acting, agile solutions – not quick fixes or outdated legacy security systems. It needs to invest in, and place its trust in, technology.

By increasing its reliance on automation, the sector will be better positioned to keep pace with and protect against the frenetic nature of modern fraud attacks.