Stakeholders Worry Over Level of e-Payment Fraud …Warns on Non-Implementation of Fraud Analytics

NEWS 11 Pic E-PPAN 2Businesses have experienced a significant shift in the 21st century from process driven to technology enabled organizations. However, as opportunities open up for businesses to leverage technology and data to drive organizational excellence, opportunities have also opened up for fraudulent activities through hacking, social engineering and all other forms of cybercrimes.

This was at the core of the annual Payment Systems and Fraud Conference organised by the E-Payment providers Association of Nigeria (E-PPAN).

Speaking at the forum, stakeholders harped on the need to security over the increasing e-payment channels available.

Country Director, Visa Nigeria, Kemi Okusanya, observed that the proliferation of devices that now use Internet to access e-payment transactions is an indication that the future will continue to be mobile and further highlights the need to strengthen security of digital platforms.

While calling for collaboration to ensure security of e-payment platforms, Okusanya noted that 1.9 million records are stolen everyday with 53 per cent linked to actual identities of people.

Worrisome figures that need to be checked, according to some experts at the event include the N237 billion lost due to fraud in banks since 2007; the 300 percent increase in fraud from e-commerce since 2014 and the over 2178 Nigerian websites hacked in 2015, of which over 25 percent were government-owned. Meanwhile, over N57 trillion transactions are said to have been carried out across different e-payment platforms this year alone. The platforms cover cheque truncations system (CTS), National Instant Payment (NIP), NIBSS Electronic Funds Transfers (NEFT), Point of Sales (PoS) terminals, Automated Teller Machines (ATMs) and web-based transactions.


In his presentation, Country Manager, Accenture, Niyi Yusuf noted that emerging trends in the Financial Industry will make combatting fraud tougher and more essential in the next 5-10 years. According to him, Competition, Emerging Technologies, Macro-Economic Conditions, Customer Expectation and Regulatory Impact are some of the factors that will shape the future of the industry.

Expounding, Yusuf noted that as competition grows in the financial industry, being able to deliver on customer protection will be a unique value proposition while technology has become the major enabler for the 21st century business.

He further observed that with the volatility of the Nigerian economy, analytics provides a unique opportunity for the business to cut down on operational inefficiencies and overhead by streamlining several business functions while still maintaining quality in the services.

On the customer and regulatory needs, Yusuf said: “As customers become more sophisticated, they expect their banks to provide them with better and faster services at cheaper rates. With analytics-as-a-service, more resources can be dedicated to improving the business’ core product. Also as regulations become stricter and more complex, having fraud analytics as a service ensures that your organization is a model company by being the first-movers in implementing fraud related regulations.”

Speaking further on the theme: ‘Leveraging Big Data Analytics in Combating Payment Fraud’, the Accenture Country Manager observed that Fraud analytics is a major step in ensuring that businesses are taking full advantage of the possibilities that technology can give.

“Data analytics help with early warning/identification of potential fraud, detection, investigation and monitoring of fraud; assessment of fraud risk, indication of probability/likelihood of occurrence and where the most likely risks of fraud exist; detection of instances of fraud and of when fraud prevention controls have been bypassed or failed and prevention of fraud when analytics are run at the time of transaction entry and initial processing,” he said.

Further needs for fraud analytics, Yusuf listed include:

  • Investigation of fraud cases to determine the circumstances of fraud and provide evidence of the full nature and extent
  • Analytics enable the extraction, analysis, interpretation and transformation of huge volume & constantly changing data (structured, unstructured) to enable detection potential instances of fraud and implementation of effective fraud monitoring programs.
  • Improved efficiency from the use of automated methods and analytical tools.
  • Analytics provides standardization from the use of repeatable fraud tests that can be run at any time.
  • Analytics allow wider coverage – Full coverage of testing population rather than ‘spot checks’ on transactions – leading to higher probability of success/finding exceptional items.

In her remark, Chief Executive Officer of E-PPAN, Onajite Regha, called on all stakeholders to leverage big data analytics to prevent fraud while also collaborating with each other in the area of sharing experiences on fraud incidences so as to prevent fraud in the system.



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