From Threat to Shield: How Fintech Empowers Financial Institutions in Combating Fraud

The financial industry has significantly changed with the vast development of Fintech technology. Financial fraud has also increased with these advances, putting the financial industry at risk globally. Through the principles of financial criminology, the study illustrates some fintech technologies that can also be used as fraud-fighting tools in the financial industry. Tools including blockchain, biometrics, artificial intelligence, and machine learning were explored based on their function in preventing and detecting financial fraud. The study has found that several benefits have been brought in by the fintech tools, which can be considered as fintech solutions that contribute towards preventing and detecting financial fraud, for example, real-time monitoring and analysis of financial transactions, improved accuracy in identifying suspicious activity, enhanced customer identity verification, secure data encryption, and robust authentication protocols. Furthermore, such fintech solutions do bring extra benefits to the sustainability of financial institutions, such as better collaboration and information sharing among financial institutions and regulatory authorities, fostering a more coordinated and proactive approach to fraud prevention. This study offers useful information for financial institutions, legislators, and regulators and advances our theoretical knowledge of the revolutionary potential of fintech in fraud prevention and detection. It highlights the importance of accepting fintech as a potent weapon in the continuous fight against financial fraud.