When Fraud Controls Slow the Customer Down

Banks spent years trying to make financial transactions faster, easier, and more seamless. Fraud is complicating that push: Sometimes the safer move is to slow the customer down. 

The 2026 ProSight State of Fraud Prevention Survey shows that many institutions are leaning toward protection. Half of respondents said they prioritize fraud mitigation over customer experience, while 41% said they balance the two equally. Only 8% put customer experience first. 

Banks are still trying to keep digital banking smooth. Fraud, though, is giving verification, scrutiny, and customer judgment a larger role in how products and payments are designed. 

The survey shows the tradeoff in several places: 

More verification at onboarding. One credit union leader said the institution is willing to add “appropriate friction during the onboarding process” because protecting members and their accounts is the priority. The leader acknowledged that extra verification may create “a small amount of inconvenience,” but said those steps can confirm identities, reduce fraud risk, and prevent unauthorized access. 

More scrutiny before real-time payments. Real-time payments create a different kind of pressure because funds can move quickly and may be irrevocable. A BSA/AML officer at a community bank said, “With the quickness in which these payment types move, it is imperative to add additional layers of scrutiny before the funds leave the institution.” Another executive said the bank was adding controls and confirmation steps to slow users down and encourage them to validate payment details before sending money. 

More false positives from tighter controls. A community bank executive described tighter debit-card controls that often decline legitimate transactions because of a risk matrix based on card usage. The executive said the approach is not optimal, but practical, given the bank’s limited options for mitigating losses. 

The leadership challenge is deciding where friction helps. Poorly designed friction can feel like hassle, blame, or broken digital banking. Well-placed friction can create the moment when a customer pauses before sending money to a scammer, opening an account under pressure, or approving a risky transaction. 

Customer education becomes part of the control. Customer error or judgment gaps were the most frequently cited source of preventable fraud losses in the survey, and 87% of respondents said their institutions plan to invest more in customer education. 

The takeaway: Seamless banking is still valuable, but fraud has made some forms of friction necessary. The goal is to place those pauses where they protect customers and the institution—and to explain them clearly enough that customers understand the purpose. 

The ProSight Fraud Alert Network helps members share fraud intelligence, receive timely alerts, and coordinate fraud prevention efforts.