New Payments Canada research reveals a sharp generational divide in payment fraud
Nearly half of Canadians aged 18 to 24 were targeted by payment fraud in the past year, and more than a quarter of them lost money - double the rate of the broader population.
That is the headline finding from Payments Canada's Payment Behaviour Tracker Study, which surveyed approximately 1,500 Canadians between February and March 2026 and highlights how Gen Z Canadians, far from being insulated by their digital fluency, are being exploited precisely because of it.
"Not only are younger Canadians experiencing fraud at higher rates, but they're encountering different types of fraud, like online shopping scams and sophisticated friends and family imposter schemes, than their older counterparts," said Stephen Yun, senior analyst, product and market research, at Payments Canada, based in Ottawa. "Gen Z's active use of digital payment methods and social media platforms, combined with a lower likelihood to take basic preventative measures or avoid specific actions to mitigate fraud risk, creates a perfect storm for fraudsters."
The national average for fraud exposure across all age groups stands at 30 per cent but among Gen Z, the rate climbs to 47 per cent. Of those who did experience fraud, 26 per cent of Gen Z respondents reported losing money, compared with 13 per cent of the general population.
Risky habits driving the vulnerability gap
The research identifies a pattern of behaviours among younger Canadians that fraudsters are actively targeting.
Over one in five Gen Z respondents (21 per cent) admitted to sharing personal banking details via email or text. Approximately 36 per cent reuse the same password across all of their accounts, a habit Payments Canada warns is particularly dangerous because it gives fraudsters a master key across multiple platforms once any one account is compromised.
Younger Canadians are also less likely to create strong passwords than the general population (57 per cent versus 71 per cent), and close to half store passwords on their smartphone, laptop, email, or in a paper notebook rather than using a secure password manager. Email and instant messaging were the primary channels used to reach Gen Z fraud targets, cited by 46 per cent and 45 per cent of respondents respectively.
Advisors whose practices include younger clients - or who are building next-generation relationships as part of a broader wealth transfer strategy - may want to incorporate fraud awareness into their onboarding conversations. As Wealth Professional has reported, financial fraud is an ongoing concern for both Canadian investors and the professionals who serve them and the threat is evolving rapidly.
AI is making scams harder for everyone to spot
The generational vulnerability story sits within a broader shift in how fraud is conducted. Sixty per cent of Canadians surveyed agreed that AI deepfakes and synthetic identity fraud are making it harder to detect scams. Nearly one in three (32 per cent) said they already struggle to distinguish legitimate payment communications from fraudulent ones.
"While most Canadians take steps to protect themselves from fraud, Gen Z's lower adoption of fraud mitigation practices suggests a gap in awareness and concern among younger digital natives," Yun said. "They assume their digital savviness protects them, but fraudsters are specifically targeting this group with sophisticated, socially engineered attacks tailored to how they communicate and conduct their financial lives."
This mirrors a broader industry trend that wealth professionals are grappling with. Advisor education on emerging digital fraud risks has become a priority across the Canadian financial planning community, as bad actors increasingly blend technological sophistication with social engineering.
How financial institutions and infrastructure are responding
Despite the rising threat, the research offers some reassurance: 63 per cent of Canadians said they feel protected by their bank, credit union, or credit card provider. Of those who reported fraud involving money loss, 70 per cent notified their financial institution, and 47 per cent of those cases were resolved within a few days.
At the infrastructure level, Canada's forthcoming Real-Time Rail (RTR) payment system - scheduled to launch in Q4 2026 - will include centralised fraud mitigation services from day one, including a confirmation of payee capability that allows senders to verify the identity of a recipient's account before transferring funds.
"Combatting fraud and financial crime requires a united front. That's why our 'Team Canada' approach to launching Canada's Real-Time Rail is so important," said Donna Kinoshita, chief payments officer at Payments Canada. "By pairing the Real-Time Rail's centralized fraud mitigation services with participants' internal fraud controls, we are building a safer, more resilient payment ecosystem."
Payments Canada is a member of the Canadian Anti-Scam Coalition, which works to co-ordinate fraud prevention across the financial ecosystem.
