A new report from Alloy has found that while Americans are increasingly alarmed by the growing sophistication of AI-driven scams, they are equally eager for banks to use the same technology to defend them.
According to the 2025 State of Scams Report, conducted in partnership with Harris Poll, 85% of Americans say they fear AI has made scams harder to detect. The most worrying types of scams include AI-generated bank impersonations (28%), voice cloning phone calls (21%), and synthetic identity fraud (18%).
Despite these fears, the survey shows that AI can also play a role in restoring trust. Two-thirds (66%) of consumers said they are more likely to choose a financial institution that employs AI-powered security tools, while 97% identified fraud prevention and security measures as the most important factors when selecting a bank.
The report paints a picture of how scams have become more personal and emotionally damaging. Over 60% of respondents said they or someone they know has been a victim of a scam, and 28% reported losing money as a result. Of those victims, one in five lost more than $5,000. Emotional distress was cited as the worst outcome of being scammed by 29% of participants.
Alloy’s fraud expert Sara Seguin said, “The data confirms what we’re seeing on the ground: AI hasn’t made fraudsters more sophisticated, it’s made them more efficient. A single criminal can now launch thousands of personalized attacks in minutes. But here’s what’s fascinating: consumers get it. They’re demanding banks use the same AI technologies to protect them.”
The findings come amid a surge in digital crime. Research from the Aspen Institute’s National Task Force on Fraud and Scam Prevention shows that most Americans receive scam messages weekly, and more than 50 million adults have already lost money to digital scams.
Further insights from Alloy’s report reveal that two-thirds (67%) of consumers believe financial institutions should reimburse victims of scams even when transactions were authorised. Younger generations were most vocal, with 73% of Gen Z and Millennials expecting compensation, compared to 62% of Gen X and Boomers.
Moreover, 69% of respondents said they would trade some level of privacy for AI-powered scam protection, signalling that consumers increasingly prioritise safety over data privacy. However, trust remains fragile—87% of Americans would lose confidence in their bank if it failed to notify them of an attempted scam.
Trace Fooshée, strategic advisor at Datos Insights, said, “As fraudsters’ use of AI tools accelerates, the scope and scale of authorised payment scams edge closer to a tipping point that threatens to upend the trust relationship across the whole financial system. As this stark reality settles in, financial institutions are racing to adjust their standards of care and investment priorities to amplify their use of AI tools and to reinvent a more deliberate and collaborative approach to managing and improving customer safety.”
As scammers exploit AI to create convincing fraud schemes, the research highlights a growing expectation among consumers that their financial institutions must be equally innovative in fighting back.
Keep up with all the latest FinTech news here
Copyright © 2025 FinTech Global
