…CBN directs financial operators to speed up response time to fraud
Banking fraud has recorded its first downturn since 2021, with the number of reported cases steadily declining across the industry, a trend largely attributed to the effectiveness of the Bank Verification Number (BVN) and National Identification Number (NIN) frameworks in curbing identity-related crimes.
While reported fraud incidents have steadily declined across the industry, the total amount involved in fraud has plummeted by 51 percent, reflecting improved controls and rapid response mechanisms within the banking system.
This positive trend is expected to further strengthen after the Central Bank of Nigeria (CBN) directed financial institutions to reduce fraud response times from approximately 48/24 hours to less than 30 minutes.
Philippe Ikeazor, Deputy Governor for Financial System Stability, said anti-fraud efforts in the banking industry continue to evolve in response to increasingly sophisticated threat vectors. While traditional fraud such as ATM card cloning has been largely neutralized, new risks such as online fraud, social engineering, SIM swap abuse, insider compromise, and authorized push payment (APP) fraud have emerged as key threats.
He explained that advances in identity management are a major factor in the decline in fraud in Nigeria. The introduction of BVN and continued integration with NIN has significantly curbed identity theft and synthetic identity fraud, closing gaps previously exploited by fraudsters.
Ikeazor spoke on behalf of the CBN Director of Development and Financial Institutions Supervision, Mr. Ibrahim Hassan, at the 2026 Nigeria Electronic Fraud Forum (NeFF) Technical Kick-Off Session held in Lagos.
Also read: BVN, NIN takes effect as banks reduce fraud response time to less than 30 minutes – CBN
“Importantly, the industry has agreed to reduce response times to fraud to less than 30 minutes. This is a decisive step that will significantly improve recovery outcomes and limit systemic harm,” Ikeazor said.
According to data presented by Premier Oiwoh, Managing Director and Chief Executive Officer of NIBSS Plc, fraud cases decreased from 123,918 in 2021 to 101,669 in 2022, representing a decrease of 18%. The downward trend continued in 2023, with the number of infections decreasing further, dropping 6% from the previous year to 95,620 cases.
In 2024, fraud cases plummeted by 27% to 70,111 cases, but in 2025 they fell even further to 67,518 cases, down 4% year-on-year.
Despite the decline in the number of cases, the monetary value of fraud showed significant fluctuations. The losses increased from N12.77 billion in 2021 to N14.32 billion in 2022 and further increased to N17.67 billion in 2023. In 2024, the amount of fraud will rapidly increase to 52.26 billion naira, highlighting the growing impact of high-value fraud cases, although the number of cases is small. This trend eased in 2025, with losses decreasing by 51% to 25.85 billion naira, but still well above the initial level.
Lagos remains a major fraud hub due to its international nature, high transaction volumes and dense financial infrastructure. Abuja and several other cities are increasingly being used as bases of operations, in part because tracking effectiveness along some corridors is relatively weak.
While web and mobile channels remain the primary fraud channels by volume, internet banking accounts for the highest fraud losses by value in fiscal year 2025. Despite having fewer transactions than other channels at 4,507, Internet banking resulted in the highest overall financial losses, highlighting its attractiveness as a low-volume, high-value target.
Oyiwo said strategic actions by the NIBSS Industrial Fraud Desk include fraud information sharing, HAWK capacity building, and regulatory reporting and escalation.
Related article: EFCC returns 802.4 million naira recovered from suspected fraudsters to First Bank
Earlier, Rakiya O. Yusuf, Director of Payment Systems Supervision and Chairman of NeFF, said that continued collaboration between financial institutions, payment service providers, infrastructure operators, identity management institutions, law enforcement agencies and other stakeholders has led to meaningful progress in reducing fraud, even as electronic transactions expand rapidly under cashless policies.
Social engineering, often supported by insider collusion, has emerged as the dominant systemic threat in both volume and value, indicating that the risk of fraud is increasingly driven by human manipulation rather than technical system compromise. Although card theft and robbery continue to register huge volumes, their economic impact remains significantly lower than that of social engineering.
This trend suggests a high success rate per social engineering incident. This is primarily because such attacks exploit customer-initiated transactions and bypass authentication through deception.
Mr. Oyewo called for increased customer awareness, especially through radio jingles, prioritization of anti-social engineering internal controls by agencies, and consistent collective industry action to combat the menace.
He also noted that the number of institutions reporting actual fraud incidents decreased from 45 in the second quarter of 2024 (Q2) to 34 in the fourth quarter of 2025 (Q4). He said this decline indicates potential underreporting, compromising effective fraud monitoring and data accuracy.
“Reporting fraud to the NIBSS Industrial Fraud Desk is a mandatory requirement for our collective good. Penalties for violations must be enforced to protect the ecosystem,” Oyiwo said.
He called on all stakeholders to deepen cooperation and information sharing with law enforcement agencies to expedite fraud detection and recovery efforts, and industry players to maximize and optimize HAWK fraud management tools. He also emphasized the need for strong regulatory oversight to drive good behavior across the industry and close persistent reporting gaps.
