Business

Nigerian banks’ losses to fraud decline by 77.62% in Q1 2024 – Report  

Banks in Nigeria recorded a significant drop in losses to financial fraud in the first quarter of this year as the amount lost in the period declined by 77.62% compared to the previous quarter. 

The Financial Institutions Training Centre (FITC) disclosed this in its Report on Fraud and Forgeries Report in Nigerian Banks for Q1 2024 just released.

According to the report, Nigerian banks lost N468.42 million in the first quarter, a substantial decline from the N2.09 billion loss they recorded in Q4, 2023.  

In terms of the amount involved in fraud, the report revealed that a total of N2.99 billion was involved in fraud in the quarter, representing a 56.73% decline compared with the N6.91 billion recorded in the preceding quarter.  

The decline in reported fraud cases 

The FITC report also indicated that there was a decline in the number of fraud cases reported by the banks compared to the previous quarter.  

“For Q1 2024, a total of eleven thousand, four hundred and seventy-two (11,472) cases were reported, and when compared to the twelve thousand, four hundred and five (12,405) cases recorded in the Q4 2023, a 7.52 per cent decrease is noted,” the organization stated.   

The report cited computer/ web fraud, mobile fraud, and POS-related fraud as the top three prevalent forms of fraudulent activity, consistent with the trend observed in the previous quarter.  

The channels 

According to the FITC report, mobile fraud accounted for 46.29% of the total losses recorded by the banks in Q1 2024 with a value of N216.83 million, while computer/web fraud entries accounted for 17.00%, totalling N79.61 million.  

“During Q1 2024, fraudulent activities were conducted through various channels, which included ATMs, online platforms such as web and mobile banking, bank branches, and point-of-sale (POS) terminals.  

“In the first quarter of 2024, cards were the only instrument for fraud that recorded an increase, while the use of cheques and cash recorded relatively lower fraudulent activities when compared to the previous quarter. 

“Specifically, there was a 31.12% rise in fraud cases through the POS Channel, rising from 2,683 cases in Q4 2023 to 3,518 cases in QI 2024. Similarly, the number of fraud cases through the Mobile Channel increased by 0.45%, rising from 3173 cases in Q4 2023 to 3393 cases in Ql 2024,” FITC stated in the report. 

More vigilance required 

  • While commending the decline in fraud activities and losses in Q1 2024, FITC said the banks would need to be more vigilant and also understudy their fraud control activities in this quarter and improve upon the same to ensure that going forward the numbers keep dropping. 
  • It added that the banks need to ensure the application of advanced fraud detection technologies and analytics to continuously monitor transactions of suspicious patterns and anomalies. 
  • Specifically, FITC cited emerging technologies such as Artificial Intelligence (A), Machine Learning (ML), Robotics Process Automation (RPA), Advanced Analytics, Predictive Modelling etc., as tools that can be leveraged by the banks to identify patterns of fraud, and proactively detect emerging frauds.  

Source: Naijaonpoint.com.

GET IT NOW

Leave a Comment