By RARZACK OLAEGBE
Cyber criminals exploit limited consumer awareness.
A crisis does not erupt suddenly. It does not explode like a volcano. It brews s.l.o.w.l.y. Like a leaky oil pipe before the explosion. Like the cracks on a wall before a fall. If the cracks linger, the fall will be worse than that of Humpty Dumpty.
On the one hand – electronic payments have turned into a movement.
Nigeria’s fintech payment boom [one of Africa’s digital powerhouses] is facing rising cybersecurity threats. The support of banks, fintechs, payment service providers [PSPs], mobile money operators, payment service banks [PSBs], high penetration of mobile phones, and user-friendly apps have turned electronic payment into a movement. This movement drives everyday living. The Nigeria Inter Bank Settlement System [NIBSS] annual fraud report showed that in 2023 alone, attempted fraud rose by 45 per cent.
On the other hand, criminals are exploiting weak systems.
The mobile and online platforms were the most exploited modes. Bank customers lost billions of naira. Many customers did not report the matter. Research showed that cyber-criminals are exploiting weak systems, lax regulations, and limited consumer awareness to perpetrate sophisticated fraud schemes. If you have been a victim of cybersecurity fraud, you would understand.
In the long term – fraud-reporting systems are fragmented
We lack enough cybersecurity awareness. This is why many bank customers still click on a phishing link. Reply to emails requesting their login credentials. Answer spurious phone calls from a ‘your bank’ manager. Open fake fintech apps. According to the NIBSS report, mobile and online channels are the weakest links.
Bank customers have lost billions of naira. These fraudulent cases went unreported because fraud-reporting systems are fragmented. Customers do not get quick resolutions. Therefore, one four-letter word that has stopped victims from pursuing fraudulent financial matters is T.I.M.E. For instance, you have cancelled an online subscription. The merchant did not stop the monthly deduction. Your bank promised to investigate the case in eight working days. Two weeks, approximately.
The other day, you visited the office of the special anti-fraud unit of the Nigerian Police. The investigating officer demanded a petition. Then he needed payment to issue a warrant of arrest. He needed the warrant to apprehend the suspect. He needed time to investigate the case. Time stood still. The time spent pursuing a case is enough to build a fintech unicorn! This is why cases are unreported. The victims simply moved on. Licked their wounds. The victims may be sceptical about returning to e-payment.
In the short term – financial inclusion might turn into a delusion
If the brewing crisis erupts, the gains of the cashless policy may evaporate. The interest of bank customers may wane. Financial inclusion may become a financial delusion.
Fun fact about cyber fraud
In 2023, ransomware criminals worldwide earned more than $1.1 billion.
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