The Central Bank of Nigeria (CBN), through the Nigerian Electronic Fraud Forum (NeFF), is working with the Association of Mobile Money and Banking Agents of Nigeria (AMMBAN) to develop a new feature on PoS terminals that will flag fraudulent transactions at agents’ locations by requesting specific KYC information before processing certain transactions.
“We are at a very advanced stage, and we’re about to finish the technology side of it in terms of activating some features,” stated Fasasi Sarafadeen Atanda, President of AMMBAN. He also mentioned that the Nigerian Interbank Settlement System is a crucial project driver.
Lilian Phido, NIBSS’s head of Corporate Communications, told TechCabal that the Nigerian Electronic Fraud Forum is also driving the collaboration.
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“Constant innovation within the industry underscored the necessity for the Central Bank to establish a dedicated body (named the Nigerian Electronic Fraud Forum) which consists of all key players and stakeholders to proactively work together in collaboration as an industry in ensuring the integrity of the payment systems across the nation,” he added.
The feature will be featured on every PoS terminal agent around the country. Following a meeting with NIBSS last week, AMMBAN hopes to have the functionality ready for introduction in the first quarter of 2024.
A coalition of security authorities, including the Nigerian police, Department of State Services (DSS), AMMBAN, and NIBSS, has also formed to make tracking fraudsters at agent locations easier. The coalition seeks to require a standard identification mechanism for the AMMBAN database’s roughly 1.7 million banking agents.
There are also conversations about agent training and certification. However, other stakeholders are skeptical about this plan.
“The entry point of the fraud is not agent location, but the fact that some accounts and wallets aren’t tied to real identities,” said Femi Omegbenigun, CEO of 3Line Card, a Nigerian payments business. “The fact that these accounts have underlying KYC issues means agents are not always aware that the money they are disbursing is proceeds of fraudulent transactions.”
While whistleblowing routes exist across the country, agents have only used them on rare occasions, according to the AMMBAN president. Banking agents have raised concerns about suspicious transactions and reported them to banks, but the financial institutions have neglected to take anything.
When the same problems were reported to security officers, they occasionally requested money before taking action. “The individual agents are always discouraged from pushing that because you will end up wasting your money and resources,” he said.
While they wait for the new feature on the PoS terminals, Atanda adds the agents are implementing the CBN’s BVN-NIN policy. To open an account, new customers must give either their BVN, NIN, or both.
Source- The Techcabal
