Nigeria’s financial services sector regulator, the Central Bank of Nigeria (CBN) has warned about the rising cost of electronic fraud in the country.
The apex bank said there was a 28 per cent increase in reported fraud cases from 2016 to 2017, and an actual loss of N1.63billion lost last year.
The regulator projected that if steps are not taken to address the issue, electronic fraud losses would hit a record N6.1 trillion by the year 2021.
The Director of Consumer Protection Department at the CBN SK Salam-Alada, gave the warning during a workshop for Business Editors and Finance Correspondents Association of Nigeria (FICAN). The workshop was oragnised by the Nigeria Deposit Insurance Corporation (NDIC) in Benin City, Edo State capital.
Salam-Alada was represented by Deputy Director at Consumer Protection Department Emmanuel Hassan on the occasion.
He lamented that every year, fraud cases have been increasing with 83 per cent of it perpetrated through electronic means while 17 per cent were via non-electronic means.
According to him, the Consumer Protection Framework (CPF) by the CBN is supposed to not only engender public confidence in the financial system, but also guarantee high standards for efficient customer service delivery, market discipline and ensure that consumers are treated fairly by financial institutions regulated by the CBN.
“We need to restore public trust and confidence in the financial system because of the problems of malfunction in our e-channels and electronic fraud (e-fraud). Innovation technology is increasing rapidly and disrupting the financial space. We no longer go to our banks physically as often as we did in the past for financial transactions.
“It is interesting to note that Nigeria is among the first countries in the world to adopt the chip and PIN methods of financial transactions verification when other countries were still considering it.
“Nigeria adopted the Real-Time Payment (RTP) in 2016; this is a remarkable feat. In 2016, customers transacted electronically up to a volume of 869 million translating in value to N69.1 trillion. In 2017, the volume of e-transactions was 1.4 billion which translated to N97.4 trillion in value.
“Fraud is a major issue on Consumer Protection. In 2016, 19,531 cases of fraud were reported by Deposit Money Banks (DMBs); in 2017, 25,043 cases of fraud were reported by DMBs."
Concerning the achievements of the CBN with respect to consumer protection, Salam-Alada, explained that a total of 13,715 complaints have been resolved in recent times resulting to the refund of N66.5billion, $18.5m, €26,319.03 and £9,085.98.