Ad
A total of N17.67 billion was lost to fraud in Nigeria’s banking industry in 2023, a figure that has soared by 496.96 per cent compared to what was recorded in 2019 and bringing the total figure of what was lost to fraud in five years to N59.33 billion.
According to data compiled from SBM Intelligence, the value lost to fraud has been on a consistent increase over the years. However, the number of fraud cases which had peaked in 2021 has begun to decline.
Irrespective, the number of fraud incidences had risen by 112.74 per cent when compared to the 2019 figure. In 2023, a total of 95,620 cases had been recorded, higher than the 44,947 cases recorded in 2019 and 22..84 per cent lower than the 123,918 cases that were recorded in 2021.
Banking industry fraud was rife in 2021 as social engineering peaked following the 2020 global lockdown and a gradual return to normalcy. The number of fraud incidents had declined in 2022 to 101,669 and further reduced in 2023.
The value lost has however consistently risen over the past five years despite a gradual reduction in cases. In 2019, only N2.96 billion had been lost, the figure soared by 292.23 per cent to N11.61 billion in 2020.
In 2021, a total of N12.77 billion had been lost and another N14.32 billion was lost in 2022 while N17.67 billion was lost in 2023. Of the figure lost in 2023, N9.38 billion had been lost through social engineering.
This is higher than the N8.025 billion that had been lost thought the channel in 2022. Social engineering is when fraudsters trick individuals to reveal personal data that could be used to access their bank accounts.
Website and server hacking of financial institutions also resulted in a total value lost of N2.44 billion, a sharp rise compared to N6.2 million that was lost through that channel in 2022. With increased cash usage, the value lost to robbery soared from N437.4 million in 2022 to N1.61 billion in 2023.
Value lost to fraud through pin compromise likewise rose to N1.30 billion compared to the previous year’s figure of N852.3 million, as what was lost due to internal collusion declined from N1.52 billion to N1.03 billion in 2023.
Meanwhile the value lost to fake assistance soared from N133 million in 2022 to N1.01 billion in 2023 as the amount lost through phishing doubled from N240.6 million in 2022 to N551.2 million last year.
Lack of two factor authentication also led to a loss of N192.3 million an increase compared to N137.8 million that was lost through the channel in 2022, as SMShing led to the loss of N30.7 million in 2023 compared to N1.01 million lost the previous year.
Noting that fraud is common in the financial sector globally, SBM Intelligence noted that in Nigeria, it is endemic. “Although the number of incidents has reduced from a 2021 high, the amount of money lost to fraud has increased significantly. This may indicate that the perpetrators have gotten better at their act and figured out ways to move large sums of money undetected.”
Ad
