Real-Time Payment Scams: How Device Identity Can Stop Instant Fraud Before It Happens
TLDR
Real-time payment networks — from India’s UPI to the UK’s Faster Payments and the US’s FedNow — have transformed how money moves, but they’ve also opened a new frontier for fraud. Instant transactions mean instant losses, leaving banks and fintechs with little time to detect or reverse suspicious activity. Traditional anti-fraud systems, built around batch reviews and post-event analytics, can’t keep up with the pace of real-time flows. Ideem’s Zero-Trust Secure Module (ZSM) and Passkeys+ give institutions a new line of defense by detecting whether each transaction originates from a known, authenticated device — stopping high-risk or unauthorized activity before funds ever leave the account.
The speed problem in modern payments
In the traditional banking model, fraud detection had time on its side. Transactions could be flagged, reviewed, or reversed before settlement. Real-time payment systems remove that buffer. Once approved, the money is gone — often in seconds.
This speed is great for consumers but devastating for fraud teams. Criminals now exploit the very advantage that makes instant payments so attractive. They trick victims into authorizing transfers, use compromised devices to send money, or test small “safe-looking” transactions to bypass risk engines.
The challenge is simple but severe: once a fraudulent real-time payment clears, recovery is nearly impossible. The solution must happen in the milliseconds before the payment executes.
Why traditional controls are falling behind
Legacy fraud systems rely heavily on historical data and delayed decision-making. They monitor accounts after the fact, looking for abnormal behavior or reported disputes. That model fails in real-time ecosystems where payment authorization and settlement happen simultaneously.
Even advanced analytics struggle because:
- The transaction window is too short. Risk scoring has milliseconds to work, not minutes.
- Behavioral models lag behind attacker innovation. Fraudsters test new scams faster than institutions can retrain models.
- Authorized push payment scams blur intent. Victims are often the ones who approve the fraudulent payment.
This environment demands controls that can authenticate both the user and the device instantly — proving that the person authorizing the transfer is doing so from a trusted endpoint, not a hijacked session.
The rise of instant fraud techniques
Recent industry data shows a surge in real-time payment scams that exploit both social engineering and compromised devices.
- Impersonation scams: Fraudsters pose as bank representatives or government officials and persuade users to send money instantly.
- Remote access attacks: Criminals take control of a victim’s phone or desktop through malicious apps or links.
- Synthetic accounts: Fraudsters open legitimate-looking digital accounts to send and receive illicit transfers, blending into real traffic.
Because many of these scams rely on the victim’s cooperation or on a trusted device that has been compromised, transaction-level authentication becomes essential. The system must verify not only who is authorizing the payment, but which device and what state that device is in at the moment of approval.
Device identity as a real-time fraud barrier
Every payment device has unique characteristics: hardware signals, secure element identifiers, OS fingerprints, and cryptographic keys. When these are bound deterministically to a user identity, they create a digital fingerprint that can’t easily be faked or transferred.
Ideem’s Zero-Trust Secure Module (ZSM) leverages this principle to provide real-time device authentication at the transaction level. Before any transfer is approved, ZSM verifies whether the device matches the one previously enrolled and trusted by the institution.
If the transaction originates from an unrecognized device or altered environment, it can be flagged for review — or stopped outright. This doesn’t rely on behavioral guessing or network heuristics; it’s a deterministic check that confirms the origin of the action.
Passkeys+, Ideem’s device-bound credential layer, complements this by ensuring that only a cryptographically authorized device can complete a transaction. This combination transforms device identity from a passive record into an active security gate.
From detection to prevention
Real-time payment fraud prevention depends on shrinking the gap between detection and decision. With deterministic device binding, that gap effectively disappears. Each transaction can be validated instantly, without introducing friction for legitimate users.
Instead of waiting for downstream analytics to flag an anomaly, Ideem’s system intervenes before authorization, asking a simple question: Is this transaction coming from a trusted, registered device?
If yes, the payment proceeds seamlessly.
If no, it’s stopped in its tracks.
This pre-transaction intelligence enables institutions to act within the same instant the fraud attempt occurs — not hours or days later.
A smarter, faster fraud prevention model
Device-based authentication shifts fraud prevention from reactive to predictive. It allows teams across product, risk, and compliance to operate from the same source of truth: the verified device identity.
Benefits include:
- Instant risk decisioning at transaction speed
- Reduction in false positives since device context is deterministic, not probabilistic
- Stronger compliance posture under emerging global guidance on strong customer authentication
- Improved customer trust through seamless, invisible protection
For institutions running on real-time rails, this approach replaces batch-era fraud controls with a system that matches the velocity of modern payments.
A readiness checklist for fraud-ready instant payments
- Map real-time payment exposure
Identify all products that support instant transfers and assess which rely on delayed or post-event fraud analysis. - Implement deterministic device binding
Use device-level cryptographic registration to link users and devices permanently, ensuring traceability. - Integrate real-time authentication triggers
Embed device verification checks directly into the payment initiation process to prevent unauthorized activity. - Adopt continuous verification
Monitor device integrity and credential validity throughout the user session, not just at login. - Deploy Ideem’s ZSM and Passkeys+
Use these tools to unify device identity and authentication, ensuring every instant payment is both trusted and traceable.
Looking ahead
The promise of real-time payments depends on real-time trust. As digital economies accelerate, speed without verification creates systemic risk — not just for banks and fintechs, but for the users who depend on them.
By embedding device-level identity into the transaction layer, financial institutions can stop fraud at its true origin: the endpoint. Ideem’s Zero-Trust Secure Module and Passkeys+ were designed for this exact shift — where prevention must happen at the same speed as the payment itself.
Instant transactions shouldn’t mean instant exposure. With deterministic device verification in place, institutions can make real-time payments both fast and fraud-resistant.
Sources
- The Paypers – Real-Time Payment Scams and the Race to Improve Fraud Controls
https://thepaypers.com/expert-opinion/real-time-payment-scams-and-the-race-to-improve-fraud-controls--1261935 - Finextra – Why Instant Payments Need Instant Fraud Detection
https://www.finextra.com/blogposting/25788/why-instant-payments-need-instant-fraud-detection - PYMNTS – Real-Time Payments Fraud Rising as Networks Expand
https://www.pymnts.com/news/fraud-prevention/2024/real-time-payments-fraud-rising-as-networks-expand/ - Federal Reserve – Mitigating Fraud in Real-Time Payment Systems
https://www.frbservices.org/resources/financial-services/fednow/mitigating-fraud-in-real-time-payment-systems.html - Ideem – Device Binding and Passkeys+ for Real-Time Fraud Detection
https://www.useideem.com/passkeys-plus