FICO Survey: Payment scams hit home for younger Kiwis — Gen Z and Millennials 30% more worried

Global analytics software leader FICO has released new consumer fraud research, highlighting growing concern among New Zealanders regarding payment scams and identity theft – especially among younger generations. With real-time payments enabling instant, often irreversible transfers, 1 in 6 Kiwis (17%) worry about being tricked into sending money to fraudsters.

That figure rises to just about 1 in 4 (22%) among Gen Z and Millennial consumers aged 18–34. When asked which scams they believe would result in the most financial loss, 46% of respondents pointed to deception-based payment fraud, far ahead of stolen cards (18%) and identity fraud (12%).

“Young Kiwis can feel particularly exposed to scams because their financial lives are so tightly woven with the digital world,” said Diane Wylie, New Zealand Country Manager at FICO. “They’re using apps and instant payment platforms every day, often juggling tight budgets. Add in the constant stream of scam warnings on social media, and it’s no surprise this generation feels the threat up close — it’s personal, immediate, and hard to ignore.”

Identity Theft Still Weighs Heavily on Young Adults

New Zealanders continue to see identity theft as a major concern, with 22% citing it as their top financial crime fear. Among Gen Z, 33% believe their identity has already been used fraudulently – 14% higher than the national average.

Yet despite these concerns, younger consumers don’t always prioritise security when choosing new financial accounts. Just over 1 in 3 Gen Z respondents (38%) ranked ease of use ahead of fraud protection (33%), while Millennials were more focused on cost: with 29% prioritising good value, 27% focused on ease of use and fraud protection coming in third at 25%.

“Security is essential, but it can’t come at the cost of the customer experience,” said Wylie. “Financial institutions need to embed fraud prevention into the user journey in a way that feels seamless. When identity checks and fraud controls work together behind the scenes, it not only speeds up applications — it ensures genuine customers aren’t held back by unnecessary friction.”

Security vs. Usability: Trust Doesn’t Always Translate to Action

New Zealanders overwhelmingly believe in-branch account opening is the most secure option (74%), and that trust is reflected in their preferences for complex products like mortgages and personal loans.

But when it comes to digital channels, behaviour and beliefs diverge.

Passcodes sent to a bank’s app are trusted by 53%, and 61% said they like or prefer this type of payment authentication, yet attitudes change when asked about preferred method for applying for bank products.

While 42% say mobile apps are more secure than websites (37%), more Kiwis still prefer to apply via a website than through an app for almost every product — including digitally native options like buy-now-pay-later. It suggests that while trust in apps may be growing, comfort and usability are still playing catch-up.

A similar contradiction appears in payment authentication. New Zealanders are clear on what feels safest: biometric methods top the list, with 83% rating fingerprint scans as either “good” or “excellent” for security, and face scans not far behind at 79%. Iris scans came in at 69%. Yet these aren’t always the most preferred methods when it comes time to make a payment.

Passcodes sent via SMS, while less secure in practice, remain the most popular authentication method for online card payments, with 78% of New Zealanders saying they like or strongly prefer it. In comparison, passcodes sent to a bank’s app are trusted by 53%, but only 61% prefer using them.

This gap between trust and adoption highlights a clear opportunity for banks: improve the user experience of secure options to ensure the most robust methods are both trusted and used.

FICO’s survey was conducted by an independent research company adhering to research industry standards. 1,000 New Zealand adults and 1,004 Australian adults were surveyed, concluding in August 2024. This was part of a project surveying approximately 14,000 consumers in 14 countries including: Canada, Brazil, Colombia, India, Mexico, Philippines, Spain, UK, USA, Malaysia, Thailand, Indonesia, and Singapore.