J.D. Power Finds Banking/Credit Card Account Holders Complacent on Fraud Protection

By Roy Urrico

Twenty-nine percent of banking customers and 24% of credit card customers have experienced fraudulent activity on their accounts in the past year, but many have not taken any proactive protective actions as a result. That is according to the recently released J.D. Power 2025 U.S. Financial Protection Satisfaction Study.

J.D. Power, the Troy, Mich.-based data analytics, software, and consumer intelligence company, also found that many study respondents in the past 90 days did not take any protective measures, such as reviewing their accounts, updating passwords or adding multi-factor authentication. In most cases, these customers do not recall their providers prompting them to take action on security measures.

Jennifer White, senior director for banking and payments intelligence at J.D. Power.

"Financial institutions are spending billions on cybersecurity to address the constant threat of fraud, but there’s only so much they can do on their own. Customers really need to do their part by making use of the various tools provided to protect their accounts, but many are still not aware of the resources that are out there to help them," said Jennifer White, senior director for banking and payments intelligence at J.D. Power.

White continued, "Perhaps the biggest concern is that half (50%) of bank customers and 55% of credit card customers do not recall recently being prompted by their providers to take action on security measures. Customer awareness is key to a strong fraud defense and bank and credit card providers seem to be missing the mark on ensuring their customers are aware of their options.”

Key Takeaways

The 2025 study collected 40,197 responses from September 2024 through September 2025 from customers in the U.S. who have a primary banking relationship with a qualifying financial institution or a primary credit card relationship with a qualifying credit card issuer.

Among the firms in the study: Navy Federal Credit Union, American Express, Bank of America, Barclays, Capital One, JPMorgan Chase, Citigroup, Citizens Bank, Discover, Goldman Sachs, Huntington, KeyBank, M&T Bank, PNC, TD Bank, USAA and Wells Fargo.

Findings include:

• Banking and credit card fraud disproportionately affects Gen Z. Forty-three percent of Gen Z members experienced some form of checking, savings or debit fraud and 41% experienced credit card fraud in the past 12 months. The study surmised this is likely the result of Gen Z’s increased use of debit cards and digital person-to-person payment (P2P) apps.

• Many customers take no action to protect accounts. The most common protective measures include reviewing recent transactions, updating mobile apps and passwords and setting up account alerts.

• Account security prompts missing the mark. Many banking customers and credit card customers did not receive security prompts from their providers in the 90 days prior to the survey. The most common prompts are reminders to set up multi-factor authentication and to update passwords.

• No such thing as too much protection. Overall satisfaction scores are largely consistent in two metrics: one when customers perceive the level of security offered by their financial institution or credit card provider as just right; and another when they perceive them as burdensome. However, when perceiving lax security, satisfaction scores fall sharply.

  
  

In a separate interview with Finoptamus, White offered insight on J.D. Power’s findings and potential impact on credit unions and community banks.

Credit Unions (and Community Banks) Should Be Concerned

“J.D. Power benchmarks only the largest retail banks and issuers in this (U.S. Financial Protection Satisfaction Study) for many reasons, but the most practical is the ability to obtain sufficient consumers response rates. With fraud rates around 1 in 3 consumers, once we identify their primary banking or card issuer partner the ability to capture responses from smaller market share entities is a challenge,” said White. Nevertheless, based on this report, “credit unions and community banks should certainly be concerned,” she added.

“Within our larger U.S. Credit Union Satisfaction Study (April 2025), we see that 1 in 5 members contacted their (credit union) in the last 12 months about fraud/unauthorized activity - a number that is holding constant over a three-year period,” White explained. In that same study, J.D. Power found trust carries the highest weight in determining member satisfaction and that having members who say the credit union "completely supports me in challenging times" is a significant driver of satisfaction. “And the No. 1 way customers tell J.D. Power that a bank can demonstrate that they care is to ‘alert me of suspicious activity on my account.’ Finally, we also know that 71% of credit union deposit account customers have at least one other deposit account at retail banks like Chase, Bank of America, Wells Fargo, USAA, and Capital One (to name the top 5).”

Added White, “This Financial Protection Satisfaction Study identifies the best practices in helping customers protect their accounts from bad actors while also benchmarks what must occur to help make a bad experience like fraud convert into a trust building opportunity. The benchmarks within this body of research reflect best deposit account and cardholder practices - regardless of where their primary relationship sits.”

Generational Fraud, Proactive Interaction

When Finopotamus asked: How should credit unions (and banks) react to the generational fraud problem? “Gen Z's fraud frequency (both bank and card) surprises many interested in this research. If we rely on stereotypes, the idea that Gen Z's tech savviness will protect them is shattered once we realize their fraud incidence is the highest among all generations,” said White.

“Credit union reactions should be serious as attracting and retaining Gen Z customers is high priority - especially among those who are emerging affluent customers. The reality is their higher use of debit cards and P2P payments places Gen Z at greater risk,” White observed. “The opportunity to protect them from fraud and then, perhaps more importantly, help them resolve fraud offers a strong relationship building journey.”

Ahead of any proactive customer interaction, it is important for financial institutions to review their content and digital experiences to consolidate messaging, White said, adding “The highest performers among large retail banks offer consolidated security centers in the digital experience to guide customers through best practices.”

Beyond the investment in a security center, it is mission critical that more members are encouraged to review their existing security settings and prompted to take action, recommended White.

She continued, “Some best practices include multi-factor authentication, setting alerts, and even making sure your mobile app version is up to date. While three in four large retail bank customers believe they have taken action in the last 90 days to keep themselves safe, most are reactively reviewing transactions instead of knowing how to lock their debit card (as an example). And on average, only half of banks encouraged customers to take action in that same timeframe. Now is the time to be proactive and encourage customer action.”