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Cybercrime, fraud may pose risks to digital economy, financial inclusion

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THE GOVERNMENT must prioritize measures to address the proliferation of cybercrime and online fraud as these could affect the digital economy and hamper financial inclusion efforts, analysts said.

“Cyber fraud and cybercrime create disincentives to participate in the digital economy, leading to loss of potential monetary gains and slower financial inclusion,” University of Asia and the Pacific Senior Economist Cid L. Terosa said in an e-mail.

Cybersecurity breaches result in losses for individuals and businesses, he said. These include financial losses from fraud and data breaches, operational and business activity disruption, intellectual property theft, and loss of customer trust and loyalty.

“Technological limitations in our country have enabled many to flagrantly defy the SIM Registration Law,” he said.

“It appears that loopholes in the institutional governance and implementation of the law have been exploited by cybercriminals,” Mr. Terosa added.

President Ferdinand R. Marcos, Jr. enacted Republic Act No. 11934 in 2022 to “aid law enforcers to track perpetrators of crimes committed through phones.”

Ronald B. Gustilo, national campaigner of Digital Pinoys, said the government must increase funding support for efforts to combat cybercrime and online threats.

“They should use these funds to hire experts and acquire the technology needed. The government also needs to craft a program to develop more cybersecurity, legal and digital forensics experts who will eventually aid its campaign to eradicate these criminals,” Mr. Gustilo said in a Viber message.

Fintech Alliance.PH Chairman and Rizal Commercial Banking Corp. Executive Vice-President and Chief Innovation and Inclusion Officer Angelito “Lito” M. Villanueva said in a speech last week that nearly a quarter of Filipinos fall prey to digital fraud.

“The detrimental impact of this issue is reflected in the 4.3% revenue loss experienced by e-commerce platforms [in the Asia-Pacific region] due to cybercrime,” he said, citing data from the Merchant Risk Council’s 2022 Global Payments and Fraud Report.

“Education is the cornerstone of our mission, and transparent discussions on all facets of the finance industry are imperative to enhance consumer awareness and resilience,” he said.

He noted the importance of digital and financial literacy to help combat cybercrime and fraud.

For their part, financial firms want to be “multiple steps ahead” in ensuring the security of their clients, Mr. Villanueva said.

“That’s the only thing that we have to protect: trust amongst our public, our consumers, our customers to make sure that they will have that faith in terms of the reliability and transparency of the system,” he added.

Mr. Gustilo also emphasized the need to include digital literacy in the country’s basic and secondary education curriculum.

“With the ongoing crisis in cyberspace, people are being driven away from the efforts of the government and the private sector to promote digitalization,” he said. — B.M.D. Cruz

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