According to the latest Nigeria Inter-Bank Settlement System (NIBSS) report, Nigeria's financial sector experienced a loss of N52.26 billion due to fraud in 2024. This represents a 196% surge over the past five years.
Increase in Financial Losses
The NIBSS report reveals that the N52.26 billion lost in 2024 marks a dramatic increase from N17.67 billion in 2023, a jump of N34.59 billion in a single year. Overall, over the past five years, the amount lost to fraud has surged by 350%, from N11.61 billion in 2020 to the current figure. However, there was a 31% decline in the number of reported fraud incidents, dropping from 101,624 in 2020 to 70,111 in 2024.
Use of Stolen Identities
A particularly alarming trend highlighted in the report is the rampant use of stolen identities, especially those of senior citizens, to open fraudulent accounts. In 2024 alone, fraudsters siphoned N400 million through such accounts, dissipating funds rapidly after transfer. One case involved an individual's selfie from Asia being used for verification, with accounts linked to Hong Kong across at least three financial institutions, adding complexity to Nigeria's battle against financial crime.
Countermeasures and Solutions
Despite rising losses, the ratio of fraud value to total transaction value offers hope. Over five years, this figure dropped from 0.0053% in 2020 to 0.0040% in 2024. Yet, a 338% spike in attempted fraud between 2023 and 2024 signals growing aggression from fraudsters.
Nigeria's financial industry faces a pressing need for regulatory review and reinforcement to combat fraud and improve recovery rates. Collaborative efforts between financial institutions, regulators, and law enforcement are essential to mitigate this threat. As the digital payments sector grows in the country, so does its exposure to sophisticated crime, with the NIBSS report serving as a call to action for safeguarding the financial ecosystem.
