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Experts Seek Improved e-Channels Security, Banks Lose N237bn In 10 Years

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By peter oluka

Fraudsters, especially through the electronic payment channels have stolen about N237 billion since 2007 from Nigerian banks.

This was made known on Monday by the Niyi Yusuf, country manager, Accenture, who declared that the e-payment sector was at the risk of huge losses.

Yusuf spoke as one of the lead presenters at this year’s edition of annual payment systems and fraud conference organised by the E-Payment providers Association of Nigeria (E-PPAN) in collaboration with the CBN and other major stakeholders in the e-payment industry.

Discussions at the forum were woven around the theme: ‘Leveraging Big Data Analytics in Combating Payment Fraud.’

According to him, as technology grows, the fraudsters also become sophisticated leveraging the pervasive Internet access, stating that since 2007, about N237 billion has been at the risk of fraud.

“As the adoption of e-payment rose in Nigeria, so also the amount lost to fraud. Only 12 per cent of fraud happens across the counters while the remaining 88 per cent is online,” he said.

According to Yusuf, the emerging trends in the financial industry will make combating fraud tougher and more essential in the next five to 10 years.

Speaking at the forum, Mr. Tunde Lemo, chairman, Lambeth Trust Limited and member, board of trustees, E-PPAN, said with increasing transactions, stakeholders have to come together to face tougher challenges in combating electronic fraud (e-fraud).

Also speaking, Mr. Adebayo Adelabu, deputy governor, Operations, CBN, challenged the players in the e-payment sector to take security measures very seriously, saying the apex bank would continue to implement policy framework that will continue to engender secure cashless transactions in the country.

In his submission, Mr. Dele Adeyinka, chairman, Committee of E-Banking Industry Heads (CeBIH), noted that the rising volume of transactions across different payment channels meant that “we need to constantly look for ways to ensure the e-channels are much more secure for people to transact without fear of losing their money.”

Meanwhile, of all the e-payment channels available in the country, ATM, web and mobile account for 77 per cent of fraud incidences, according to According to Head, Industry Security Services, NIBSS, Mr. Olufemi Fadairo.

Fadairo tasked stakeholders on the need to consolidate data in the industry towards mitigating fraud incidences.

Also, Kemi Okusanya, country director, Visa, emphasised the need to strengthen security of digital platforms, saying 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 “we all have a duty to collaborate to ensure we secure those platforms.”

She noted that 1.9 million records are stolen everyday with 53 per cent this linked to actual identities of people. “To secure our future, we must perfect our data, devalue it when necessary and harness it to prevent fraud,” she said.

Mrs. Regha Onajite, chief executive officer of E-PPAN, called on all stakeholders to leverage big data analytics to prevent fraud while also collaborating with each others in the area of sharing experiences on fraud incidences so as to prevent fraud in the system.

Meanwhile, over N57 trillion transactions are said to have been carried out across different e-payment platforms this year alone.

The platforms, according to experts who spoke at the event, cover cheque truncations system, National Instant Payment (NIP), NIBSS Electronic Funds Transfers (NEFT), Point of Sales (PoS) terminals, Automated Teller Machines (ATMs) and web-based transactions.

According to them “over N4 trillion cheque transaction has been done, NIP has done N40 trillion, NEFT has recorded N9 trillion, PoS has seen N975 billion, ATM transactions have reached N4.2  trillion while web-based transactions stand at N129 billion this year alone.”

They experts further hinted that the country is facing a tougher time in combating electronic fraud owing to the growth in emerging trends and technologies that make e-payment possible for bank customers.

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E-Financial

Nigerian Farmers Log on for Cash in Hi-Tech Networks

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It looked like the end had arrived for Adewale Fatai’s chicken farm. Money was running out.

 

Built to house 30,000 chickens, the farm was producing fewer than 2,000 chicks. His family had no funds to lend, and Nigeria’s banks weren’t interested.

 

Instead, he went online.

 

Two years later, Fatai now has 20,000 chickens. Flanked by thousands of chirping birds at his farm in Nigeria’s southwestern Ogun state, Fatai told Reuters that his operation was saved by Farmcrowdy, one of a breed of new peer-to-peer lending companies aiming to match farmers with small investors.

 

Farmcrowdy uses videos and photographs to show off farms to prospective investors, willing to tie up a bit of cash until harvest time and collect a small return.

 

Onyeka Akumah, co-founder and CEO, Farmcrowdy said the company has so far helped 7,000 small-scale farmers receive a total of $6 million from 2,000 investors since it launched two years ago. He said 95 percent of investment comes from within Nigeria.

 

The typical investment starts from around 90,000 naira – $300 – too little to interest many banks but enough to help keep a small farm going until harvest.

Onyeka Akumah, co-founder and CEO, Farmcrowdy

Since taking office in 2015, President Muhammadu Buhari has said he aims to revitalize the agriculture sector in Africa’s most populous nation to reduce the OPEC member’s reliance on oil exports and cut down on costly food imports.

 

But local farmers face multiple challenges – from floods, to a lack of electricity to regulate irrigation, to fighting with semi-nomadic cattle herdsmen that has claimed hundreds of lives this year. Most of the tens of millions of farmers work on a subsistence basis and live on less than $2 a day.

 

Farmers complain that they lack the access to affordable loans needed to cover their costs until harvest time.

 

Farmcrowdy and another firm, Thrive Agric, allow investors to choose a farm on the internet and decide how much to invest. They advertise returns of around 12-20 percent for investments in soybeans, maize, tomatoes, poultry and cattle. Investors buy a funding stake and are kept updated on the progress of crops.

 

“One of the primary problems we were trying to solve was solving the problem of access to funds for farmers: giving them the right expertise for them to grow and also linking them to markets,” said Uka Eje, CEO of Thrive Agric, at his office in Abuja.

 

He said some $2.7 million had been raised by 1,670 investors for nearly 10,000 farmers since the company’s launched in 2017. His company provides farmer clients with expertise as well as fundraising, he said.

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E-Financial

Cyber Thieves Raid Banks, Inflict Losses

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Nigerian financial system has been jolted by a lethal development; and that is the growing activities of cyber criminals who work in and outside the system.

 

Website cloing, Identity fraud and Automated Teller Machine (ATM) scams, are now so rampant that the Central Bank of Nigeria (CBN), banks, switching companies, the police and users are having sleepless nights.

 

In 2017, Nigeria was estimated to have lost about $450 million to cybercrimes.

 

The most common today is the fake bank alerts scam which is growing in scope and leaving in its losses in its wake.

 

In this scam, fraudsters pose as potential buyers of goods or services provided by the bank customer and after both parties have agreed on a price, send fake SMS’s indicating they have deposited money into the sellers’ account.

 

The criminals usually count on their target, believing the SMS is real and would not bother to confirm with his/her bank before releasing the goods.

 

There is also website cloning scam where websites of genuine financial institutions are cloned are the scammers using what is known as phishing, the criminals send fraudulent SMSes and emails to victims directing them fake Web sites where they are asked to input sensitive data.

 

In the emails, the criminals had attachments that, when clicked, secretly install “spyware” that can capture personal information and send it to third parties over the Internet.

 

With the information supplied by victims, the criminals successfully broke into the victims’ bank accounts leaving tales of woes and losses.

 

Though the financial institutions are mostly affected by cybercrimes, all other sectors are culpable and assured Nigerians that financial institutions are strictly compelled to adhere to CBN regulations to secure online financial transactions.

Emefiele, CBN Gov.

The CBN, said it is working on modalities for new regulations to stem the rising losses that emanate from cybercrime and technology risk in the financial sector.

 

Mrs. Aishah Ahmad, deputy governor, CBN, said that “There is compelling need to redesign regulations that will address risk that may emanate from the new emerging and increasing modern class of financial firms.”

 

Elsewhere, electronic transaction switching and payment processing companies are building more security layers on top of existing ones to check the activities of the fraudsters.

 

The Police on the other hand said that that the development was being monitored and that the Commission is inviting useful information that would help burst the crime.

 

 

 

 

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E-Financial

Renmoney Emerges Winner Of Microfinance Excellence Award

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(R - L) Yetunde Faulkner, Head of Commercial, Renmoney, receiving Renmoney’s ‘Award for Excellence in Microfinance' from Mohammed Dabai Suleyman, Director, FSS 2020, Central Bank of Nigeria, while Folasade Femi-Lawal, Head, Card Business, First Bank, looks on; at the New Age Banking Summit held in Lagos, recently.

Renmoney, a Nigerian consumer lending company, has emerged the winner of the ‘Award for Excellence in Microfinance Banking’.

 

The award was presented at the 8th edition of the New Age Banking Summit which held at the Lagos Continental Hotel, Victoria Island.

 

Other winners of the evening were: GTBank, Diamond Bank, First Bank, First City Monument Bank, Union Bank and Wema Bank.

 

Receiving the award, Yetunde Faulkner, Head of Commercial at Renmoney, said: “We’ve been working really hard to build more convenient lending solutions for Nigerians so this award will be a huge morale boost for our team!” Yetunde added, “We launched our online loan application process this year to provide loans in under 24 hours and we are looking forward to launching even better solutions in 2019”.

 

For Anisha Ajimani of the UMS Conference, the organisers of the event, Renmoney was an obvious choice for the award because of the company’s focus on technology and customer experience.

 

She said: “The New Age Banking Awards are aimed at honouring organizations that have consistently demonstrated exemplary performance. These will not just recognize the endeavours of the most successful financial organizations, but will also set a benchmark, inspiring other organizations to achieve their own goals”.

 

The theme of the two-day event was ‘Staying Relevant in the Changing Financial Landscape of Nigeria’.

 

It was attended by a wide array of industry experts comprising Chief Information Officers of financial institutions in Nigeria, speaking on various developments and challenges in the digital banking and fintech space.

 

 

 

 

 

 

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