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The financial industry has seen continuous upward trend in its technological advancement. Financial technology (FinTech) is an innovation which is revolutionizing the financial sector (Goldstein, Jiang, & Karolyi, 2019), through improvements in the process, delivery, and the use of financial services (Mention, 2019). FinTech offers financial services and products within the digital space, thereby promoting more convenience and better experience for consumers by making financial transactions easier, faster, and cheaper (Omarova, 2019). Financial technology services encourage financial inclusion across social and economic domains, meet unfulfilled customer needs, reduce inefficiencies (Mnohoghitnei, Scorer, & Shingala, 2019), and penetrate the underserved banking markets (Jagtiani & Lemieux, 2018). Digital technologies and widespread access to mobile phones are driving the use of financial services (Huang, Guo, Xie, & Wu, 2012). For example, a recent report indicates that the total number of mobile phone users worldwide from 2015 to 2020 stands at between 4.15 billion to 4.78 billion (statista.com, 2019). Other technological factors to the rapid developments in FinTech services are the deployment of Artificial Intelligence, Machine Learning, Big Data Analytics, Blockchain Technology, Internet-of-Things (IoT), Robo-Advising, Cloud computing (Belanche, Casaló, & Flavián, 2019; Chen, Wu & Yang, 2019), and the social media (Miskam, Yaacob & Rosman, 2019).
FinTech services span electronic payments, insurance, banking, and wealth management services, which are mainly performed on digital marketplaces for selling financial products (Mead et al., 2016). However, despite the promises of the technology, FinTech services are faced with challenges. It is a disruptive technology that affects traditional financial services (Hua, Huang, & Zheng, 2019; Nuyens, 2019). For instance, Blockchain and Bitcoin continue to disrupt traditional financial services (Wubbe, 2018). Also, FinTech provides opportunities for criminals to extort both the financial industry as well as consumers. It brings more risk such as cyber-attacks, money laundering (Nuyens, 2019), and breach of privacy of personal data (Mention, 2019). As a result, banks and other financial institutions have become the major targets for fraudulent activities. Currently, the amount of personal data that is put online every day is inestimable. This includes data from online buying, online banking, credit card and mobile wallet enrollment, social media use, and from application downloads and sign-ins. Thus, a person’s information is in danger of identity theft. According to Symantec Corporation (2018), about 41 per cent of people who access services through their mobile devices cannot properly identify a phishing attack, making users vulnerable to identity theft. Mobile platforms are one of the highly targeted areas for cybercriminals. Ernst and Young FinTech Adoption Index (2017) suggests that 64 per cent of FinTech users prefer to use mobile digital channels. Yet, recent report shows an increase in mobile fraud by 117 per cent (Symantec Internet Security Threat Report, 2017).
Identity theft poses several risks to individuals and societies at large. Identity theft is a criminal act through which the offender obtains and uses in a fraudulent manner the identity of another person (Moise, 2015). Cyber-identity theft is carried out by the use of Information and Communication Technology (Moise, 2015) and may include strategies such as hacking, phishing, pharming, traffic redirections, keyloggers, and stealing of passwords. Victims of cyber-identity theft suffer emotional, physical, psychological, and social problems (Watson et al., 2018). A person may suffer directly (such as loss of money) or indirectly (such as tarnished image and loss of trust with business associates) from identity theft (Harrell & Langton, 2013). Identity theft causes financial loss (Romanosky et al., 2011) and reputational damage to the victims (Miri-Lavassani et al., 2009). An example of a damaged reputation is when a cybercriminal uses a victim’s credit card details to buy obscene items or illicit drugs from questionable online retailers (Foley et al., 2010).