According to a report published by Crowe, fraud accounts for US$5.127 trillion in losses annually. Africa’s transition into the digital world has also been followed by fraudsters who prey on the weak security systems.
Sam Okojere, chairman of Nigeria Electronic Fraud Forum, stated last year that electronic fraud has risen by $14.2 million between 2016 and 2018. Fraud occurring over the counter declined and was replaced by moe digitally adept systems. Those fraudulent activities have ushered in the rise of new payment channels. The most hit platforms are Automated Teller Machines, point of sale systems, and mobile payments.
The CBN financial report of 2018 shows 2018 as the year with the highest incidences of ATM fraud roughly 34.87 percent. It was closely followed by mobile payment channels at 28.21 percent and POS at 19.55 percent.
The emergence of fintech companies throughout Nigeria has greatly impeded the work of fraudsters. The use of ATM details, BVNs, and mobile banking PINs for fraudulent transactions has become common.
What is the solution?
Fraud has affected the fintech sector for several years affecting major players within the industry. The fraudsters prey from one fintech company to the other adopting similar dubious methods. Voyance began a graph database capable of in the form a Sigma. The data science company can flag several identifiers into the database and share it with other members of the Sigma alliance who use this platform.
The co-founder of Voyance, Abdulhamid Hassan, disclosed how widespread fraud affects companies in Nigeria. Most of the cases never get mentioned as everyone wants to save their reputation. Hassan would like fintech companies to have a list of identifiers – phone numbers, IP addresses, and BVNs.