New Telegraph

Nigeria’s e-payment fraud hits N9.62bn in single quarter

The number of electronic payment fraud otherwise recorded by banks dropped by 29.40 per cent in the third quarter of 2022, according to findings by New Telegraph. Data obtained from FIT revealed that the crime rate was reduced by 8,042 during the period under review. However, while the number of attacks represents a 29.40 per cent decrease in two quarters, the total amount of money reported to be involved increased by 9.50 per cent to N9.62 billion from N8.78 billion in Q2’22.

The breakdown showed that the total number of fraud and forgery cases reported by Nigerian banks was 19,314 as against 27,356 reported in the second quarter of 2022. Also, for the total amount lost due to fraud incidents, there was a significant increase of 207.94 per cent from N1.17 billion in the second quarter of 2022 to N3.62 billion in the third quarter of 2022. In essence, the number of attacks may have decreased within that particular period, but more money was lost to the fraudulent attacks. FITC, which reeled out the data, is an organisation mandated to receive data on fraud from all Nigerian banks and prepare quarterly reports. The figures show that the highest number of occurrences were recorded under computer/web fraud followed by mobile fraud, which includes fraud activities through USSD transactions and ATMrelated fraud. Data by Nigeria Inter- Bank Settlement System Plc (NIBSS) also showed that fraud attempts via mobile channels saw a 330 per cent increase year-on-year (YoY) between 2019 and 2020, while attempts via web and POS channels saw a 173 per cent and 215 per cent increase YoY. In those nine months, 96 per cent of the attacks were successful and there were 46,126 of such attacks.

“This trend is expected to continue as Nigeria further grows financial inclusion and customers become increasingly dependent on electronic channels for their day-to-day transactions,” NIBSS stated. In other words; things are expected to get a lot worse, according to the organisation described as Nigeria’s central switch for the financial industry.

NIBSS’ role as the Nigerian central switch means it processes upwards of 10 million transactions on a daily basis. To make e-payment work in Nigeria, the Head of Engineering at OnePipe, a fintech startup company that drives digital financial services, Victor Irechukwu, said there was a need to curb fraud in the e-payment transaction. He said: “In recent months, social media has been awash with reports of money growing wings and leaving some people’s accounts to those of other people without authorisation. Many of these cases have gone viral on social media, causing embarrassment for the banks involved with many of these either quietly returned or with public acknowledgment. But not all are resolved, at least not yet.

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