Digital fraud in Latin America: an ever-evolving threat
Last update: May 2025
Latin America continues to be one of the regions hardest hit by digital fraud. In 2024, scams involving fake messages grew by 140% largely due to the use of artificial intelligence to refine identity theft and phishing techniques, according to Kaspersky. Criminals are becoming increasingly sophisticated, imitating messages from well-known companies and generating almost identical replicas of legitimate websites.
In countries such as Mexico, the growth of e-commerce has been accompanied by an excessive increase in fraud. In Mexico City alone, fraud involving “ghost parcels” grew by 222% in 2024, with companies such as Amazon and DHL being the most impersonated. In Colombia, 36% of users reported having been victims of digital fraud at least once in the last year. In Chile, cases of phishing and payment site spoofing continue to be an active threat.
Anti-fraud strategies: intelligence at the service of prevention
Faced with this wave of criminal sophistication, the only possible response is technology.
1. Artificial intelligence and machine learning
Machine learning tools allow thousands of variables to be analyzed in real time: user location, device type, transaction time, purchase history, among others. With this data, transactional profiles are created and anomalies are detected that trigger fraud alerts.
2. Customized rules and decision engines
Modern platforms, such as Kushki's, allow you to configure top-level anti-fraud rules tailored to each merchant's business model: transaction amount limits, number of attempts allowed, blocked countries, and more. All of this is configured in a modular way so that each brand has control over its risk.
3. Multi-factor authentication (MFA) and One Time Password (OTP)
Validating that the person making the purchase is actually the owner of the payment method is crucial. The use of OTP (a temporary key sent to the user's phone or email) is a powerful tool for preventing identity theft, especially for cards not present. At Kushki, we use this additional layer of security to protect every transaction.
4. 3D Secure (3DS) technology
This protocol adds an additional verification step before approving a purchase. With 3DS 2.0, the process is smoother and less intrusive: it analyzes contextual data to decide whether extra authentication is needed or if the transaction can proceed without friction. It is an essential tool for reducing fraud chargebacks.
Chargebacks: understanding the impact and how to mitigate it
A chargeback occurs when a cardholder does not recognize a charge and asks their bank to reverse it. Although it is a legitimate protection mechanism for consumers, for merchants it can represent significant financial losses, damage to their reputation, and associated operating costs.
Most common reasons for chargebacks:
Fraud: the transaction was made by someone who is not the cardholder.
Unrecognized charge: the user does not identify the purchase on their account statement.
Problems with the product/service: the customer did not receive what they expected or the item did not arrive.
Duplication: the same purchase was charged twice.
Why is this a problem for merchants?
Chargebacks not only mean refunds, but also fines from issuers, and if the level of chargebacks exceeds a certain threshold, the merchant may be penalized or even banned by acquirers.
Best practices for reducing chargebacks:
Clear descriptions on the statement: Make sure the merchant name is recognizable to the customer.
Transparent communication and order tracking: Purchase, shipping, and after-sales notifications help reduce claims.
Implement 3DS and OTP: As explained above, authenticating the user helps reduce chargebacks due to fraud.
Solid documentation: Keep evidence of delivery, purchase confirmation, and any communication that supports the transaction.
At Kushki, in addition to prevention technology, we offer detailed chargeback reports and support to manage disputes more efficiently.
International standards: PCI DSS 4.0 and security as a priority
In April 2024, version 4.0 of the PCI DSS (Payment Card Industry Data Security Standard) came into effect, establishing new requirements for card data security.
This new version requires more robust multi-factor authentication, continuous compliance validation, and a security-by-design approach. Although the standard is mandatory for companies that process card data, only 27.9% of organizations manage to maintain compliance one year after obtaining it, according to Verizon's 2024 report.
At Kushki, we are PCI DSS Level 1 certified, the highest level of security in the industry, guaranteeing our customers compliance with global best practices.
Conclusion: fraud evolves, so do we
In Latin America, where fraud continues to grow at a rapid pace, it is not enough to react: you have to anticipate. Having anti-fraud technology, authentication protocols, and certified partners like Kushki can make the difference between a secure operation and one at risk.
Investing in prevention is not just a technical issue; it is an act of trust in the people who choose to buy from you.
Make security your competitive advantage
At Kushki, we work with you to make your payments not only faster but also more secure. With state-of-the-art anti-fraud technology, robust authentication, and compliance with international standards, we help you protect every transaction.
Ready to secure your operation and offer a reliable payment experience?
Let's talk and create a fraud-proof payment ecosystem with Kushki. Contact us!
