European banks face rising fraud in 2026; AI adoption lags

A Finextra survey of 200 fraud, risk and compliance leaders at European banks finds fraud increased across multiple channels in 2026. The survey was discussed at a webinar held this year in association with NICE Actimize. Panel participants included Chris Ainsley, head of fraud risk management at Santander UK; Joe Bristow, product director and fraud subject-matter expert at NICE Actimize; and Sharon Kimathi, a Finextra researcher who moderated the session.

Respondents reported pressure from established fraud types such as card fraud and account takeover alongside newer attack vectors. Banks flagged AI-driven payment manipulation, scams tied to virtual assets and more sophisticated social engineering as growing threats. These schemes were reported across card networks, online banking, payments rails and crypto-related services.

Institutions are increasing use of artificial intelligence and machine learning to detect unusual patterns and scale monitoring. The survey shows many banks are deploying models to analyze larger volumes of transaction and behavioral data and to extend coverage to emerging channels.

Banks also reported limits on the benefits of advanced tools because of integration work. Legacy systems, fragmented data sets and the operational steps needed to put models into live decisioning environments were cited as barriers. Several participants described lengthy projects to align data feeds, update decision logic and embed models into day-to-day workflows.

The survey found variation in capability across European markets. Smaller firms and those with older technology stacks reported greater difficulty keeping up with new fraud tactics. Larger institutions reported problems applying AI consistently across different countries and product lines, which has slowed deployment in some regions.

Respondents identified priority investments for the near term. Banks plan to focus on consolidating data sources, expanding real-time monitoring, strengthening identity verification and tightening controls around payment flows. Governance work was also highlighted, including model validation, reducing false positives and ensuring fraud teams and business units can act on alerts without blocking legitimate customers.

Speakers at the webinar emphasized the operational work required to make tools effective. Aligning data, revising decision rules and changing workflows to support automated alerts were described as central tasks that follow technology procurement.

Background materials for the webinar noted that growth in digital payments, wider adoption of AI and increased use of virtual assets have created more opportunities for fraud across channels. The survey frames 2026 as a year in which banks are balancing defense of traditional fraud types with building capabilities for new channels.

The organizers invited industry leaders to register for follow-up sessions on control fine-tuning and investment priorities. The survey and webinar provided data on current threats and on the steps banks report taking to update fraud controls in response to those threats.