Nigeria’s commercial financial institution Wema Bank has reportedly disconnected seven (7) of its Fintech partners from its payment gateway platform, citing a case of fraud.
The bank disclosed that the move was necessitated following the rising cases of fraud involving some wallet accounts linked to the fintech firms.
In a statement, Wema Bank disclosed that illicit wallet accounts owned by some of its fintech partners using third-party wallet accounts had spiked.
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In a bid to protect its customers from falling victim to fraud cases, the bank launched an anti-fraud campaign for sensitization purposes, providing customers with vital information on the tactics used by fraudsters and how they can avoid falling victim to their schemes.
The anti-fraud campaign is targeted at creating awareness, educating, and equipping customers with the necessary information needed to mitigate, detect, and handle fraudulent activities on their bank accounts, which underscores the bank’s commitment to safeguarding customers’ finances and personal data.
Furthermore, Wema Bank acknowledged that the tricks used by these fraudsters are constantly evolving, hence it is committed to staying ahead by providing customers with up-to-date information on their activities.
Speaking on this Wema Bank’s Chief Audit Executive, Oluwole Esomojumi said,
“The antics of fraudsters are constantly evolving. To stay steps ahead, it is imperative that consumers have a good understanding of what interaction or engagement are telltale signs of fraud and how they can handle suspicious fraudulent engagements, hence the launch of the Wema Bank anti-fraud campaign. We are steps ahead on our end which is why we have taken time to investigate our fintech partners and those found culpable have been disengaged from our payment gateway platform.
“As a bank that is resolute in our stance against fraud, we cannot compromise the safety of our beloved Nigerians, especially when these threats of fraud are emanating from fintechs who use our platforms. Rest assured, there is no room for fraudsters here. We have multiplied the frequency of our security checks and are committed to rooting them out one by one. No fraudster is safe with Wema Bank because customer safety is our priority and empowering the lives and businesses of every customer is our mission.”
Fintech fraud cases have continued to be prevalent in Nigeria for several years, which has raised concerns. A report revealed that between 2019 and July 2023, banking customers lost N51 billion worth of savings to fraud, as cybercriminals are now targeting Fintech bank customers. Even the big names have not been spared, the likes of Flutterwave, Patricia, and Interswitch.
This growing fraud problem is not only affecting customers’ trust, but has created distrust among companies. Recall that in October 2023, Fidelity Bank temporarily restricted fund transfers to neobanks such as PalmPay, OPay, Moniepoint, amongst others.
Notably, there are concerns by several financial experts that some of these Fintech platforms have weak security measures which makes it easy for fraudsters to penetrate. However, Fintech companies in Nigeria have been urged to deploy blockchain technology to prevent cases of fraud in the sector.
Also, they are advised to propagate and implement a system that can anticipate those fraud cases before they happen, as having a solid framework against fraud for financial services has become more crucial than ever.