Banks Lose N10Bn to Cyber Fraud in 2023

Stakeholders in the banking and financial ecosystem have decried the surge in cyber fraud as Deposit Money Banks (DMBs) lost N10 billion in the second quarter of 2023, representing almost 300 per cent year-on-year compared to the previous year.

At a Mastercard forum convened to tackle fraud and cybersecurity threats in the financial sector, Kari Tukur, vice president, Customer Solutions Centre, East and West Africa at Mastercard, said despite the massive awareness and innovations aimed at combating cybersecurity, the amount lost last year by DBMs was “staggering”.

Tukur said, “With Nigeria’s rapidly growing economic expansion, we are starting to see an increase in the adoption of digital financial services, and the financial landscape is also evolving at an astronomical speed.

“What was staggering for me was in spite of the huge investment around innovation, funding in the cyber space, DBMs lost almost N10bn in Q2 last year, and that was almost 300 per cent growth year-on-year when compared to the previous year.”

She announced that there was the need for collaboration among stakeholders “to combat this rising sophistication of cyber security threat.”

Tukur highlighted that Mastercard was deeply committed to cyber security and fraud prevention within the payment industry, disclosing that the company invested $250m “to assist small businesses in addressing their cyber security needs.”

She revealed that Mastercard payment portals incorporated multiple layers of security such as tokenisation technology, encryption and biometrical to stay ahead of cyber attackers.

According to her “The sector continues to struggle with the aforementioned challenges, necessitating vigilance, proactive action and comprehensive security strategy, and Mastercard remains committed to providing safe, secure and seamless payment services and experiences for our partners and customers in Nigeria and beyond.”

Celestina Appeal, chairman, Committee of e-Business Industry Heads (CeBIH), hinted that the total loss to the banking industry in the last couple of years totalled hundreds of billions of naira while Nigeria’s Consumer Awareness and Financial Enlightenment Initiative had projected a $6trn loss by 2030 to cybercrime within and outside Nigeria.

Celestina who was represented by Mr Temitope Onibaniyi, secretary of the committee, stated that the committee was ever-willing to collaborate with industry stakeholders to fight against the perpetrators who “constantly rob banks and other stakeholders in the payments industry of their hard-earned money.”

She also stated that the need for collaboration could not be overemphasised as no individual organisation was immune to cyber security attacks.