Thanks Access Bank for being bold to make what everyone knows PUBLIC: “Nigerian multinational commercial bank Access Bank, in its latest 2023 financial report, reportedly lost N6.5 billion from fraud and forgery, up from N1.44 billion the previous year. Fraudulent transfers, withdrawals, and reactivation caused 80% of the loss, followed closely by embezzlement at 29%, which included cash theft, dry posting, cash theft, as well as electronic fraud, and USSD (9%).”

Yes, fraud and forgery have scaled in the Nigerian banking and financial sector. In short, I posit that more than 90% of fintech companies which have collapsed or are dying could be attributed to fraud. And in this fraud vector, NIN/BVN impersonation ranks #1.

As a result of the dimensions of fraud, Tekedia Capital has been investing in KYC/security related companies as we model that such domains will see massive growths in Nigeria and Africa. The NIN/BVN fraud is so novel that from the Police to EFCC, confusion is everywhere as they cannot even help banks and fintechs. 

It is like what bandits do in the physical domain where men will kidnap dozens of people and you ask, “how possible in this age of mobile?”,  we have a digital equivalent. With Access Bank making this public, I am confident that everyone will know that a battle is set. In the past, they could have put it under operating expense or bad loans or whatever, but saying it is fraud, solutions will come faster!

Simply, we need an efficient digital Police in Nigeria with the right tools because from banks to fintechs, fraud has evolved as a huge risk vector now. Of course, this is not just happening only in Nigeria; in the United States, banks are losing billions of dollars on digital related frauds.

Thanks Access Bank for being bold to make what everyone knows PUBLIC: “Nigerian multinational commercial bank Access Bank, in its latest 2023 financial report, reportedly lost N6.5 billion from fraud and forgery, up from N1.44 billion the previous year. Fraudulent transfers,… pic.twitter.com/aCKu4Ie1EJ

— Ndubuisi Ekekwe (@ndekekwe) April 2, 2024

Access Bank Releases 2023 Financial Report, Losses N6 Billion to Fraud And Forgery

Nigerian multinational commercial bank Access Bank, in its latest 2023 financial report, reportedly lost N6.5 billion from fraud and forgery, up from N1.44 billion the previous year.

Fraudulent transfers, withdrawals, and reactivation caused 80% of the loss, followed closely by embezzlement at 29%, which included cash theft, dry posting, cash theft, as well as electronic fraud, and USSD (9%).

According to the report, 6,771 attempts, the highest in 2023, were made for electronic fraud and USSD, which involved a total of N2.69 billion. The total loss recorded was N92.2 million.

In 2023, electronic fraud and USSD ranked third highest, a significant drop from their previous position as number one. Despite this, they still accounted for 80% of all recorded fraud and forgery cases. Compared to the previous year, there were almost double the total attempts at 11,403, resulting in nearly 13 times the losses, totaling $1.15 billion.

Recall that Access Bank lost N86.9 million to fraudsters in 2016, but thus dropped to N78 million in 2017. In 2018, it rose to N385.7.

Between 2019 and 2020, there were  17,432 attempts to breach Access Bank’s electronic channels via USSD codes and ATM cards.

In 2022 the Bank lost N871.4 million to fraudulent transfer/withdrawal transactions, including transactions on its electronic channels, the ICIR reported.

In the first six months of 2023, the bank lost N5.46 billion to forgers and fraudsters. This represented a 355 percent increase from N1.2 billion lost to fraudsters and forgers in the corresponding period of 2022.

Like other lenders, Access Bank spends huge amounts of money on IT. However, fraudsters are still finding ways to beat the IT security systems across the bank to steal depositors’ funds. While specific measures have been implemented by Access Bank to combat electronic fraud remain unclear, the latest 2023 report however highlights a significant reduction in such incidents by the bank.

In 2024, reports revealed that the Central Bank of Nigeria (CBN), in partnership with the Nigerian Electronic Fraud Forum (NeFF), alongside the Association of Mobile Money and Banking Agents of Nigeria (AMMBAN) have collaborated to tackle PoS fraud, by introducing a new functionality on Point of Sale (PoS) terminals.

This feature aims to identify potential fraudulent transactions at agents’ locations by prompting specific Know Your Customer (KYC) details before completing certain transactions.

Reports also says that a coalition of security agencies, including the Nigerian police, Department of State Services (DSS), AMMBAN, and NIBSS, has been formed to facilitate the seamless tracking of fraudsters operating at agent locations.