Banks and payment service providers have been challenged by the Central Bank of Nigeria (CBN) to pledge quantifiable decreases in electronic fraud.
Additionally, it called on institutions to use the Nigeria Electronic Fraud Forum (NeFF) framework to address suspicious transactions within 30 minutes.
Speaking on the topic of “Shrinking Fraud Losses with ISO 20022 and Identity Management” at the 2026 Nigeria Electronic Fraud Forum (NeFF) Technical Kick-Off Session According to Mr. Philip Ikeazor, Deputy Governor, Financial System Stability, CBN, the sector needs to move past dispersed controls and implement enterprise-wide, data-driven fraud management solutions that can produce noticeable outcomes.
Premier Oiwoh, Managing Director and Chief Executive Officer of Nigeria Inter-Bank Settlement System Plc (NIBSS), also spoke at the conference and disclosed that the financial system saw a notable improvement in fraud outcomes in 2025, with the value of funds lost to fraud decreasing by 51% year over year.
“The industry must commit to bold, measurable fraud-reduction targets, supported by clear strategic priorities,” Ikeazor continued.
Full utilization of ISO 20022 data, universal and real-time identity verification, improved round-the-clock fraud monitoring and response, organized liability-sharing and consumer reimbursement frameworks, increased interaction with telecoms and payment service providers, and stringent performance evaluation via open scorecards are some of these. It is necessary to improve what is measured.
In the end, fraud is a risk for financial stability rather than just an operational problem. Unchecked fraud creates systemic risks, erodes confidence in digital finance, and jeopardizes gains in inclusiveness.
Nigeria maintains macro-financial stability, promotes economic growth, and protects trust in its payment system by bolstering fraud controls. The central bank is still fully committed to offering the coordination, policy assistance, and regulatory leadership needed to accomplish these goals.
“We have an important and collective task ahead of us. 2026 may and should be remembered as the pivotal year when Nigeria significantly reduced fraud losses and ensured the future of its digital financial ecosystem thanks to clear goals, shared accountability, and ongoing cooperation under NeFF.
As a result, the industry decided under NeFF to cut the time it took to respond to fraud to less than 30 minutes. Ikeazor stated that this action was essential to enhancing recovery results and reducing systemic vulnerability.
“Fraud mitigation efforts have evolved in tandem with changing threat vectors,” he said. While more recent threats like internet fraud, social engineering, SIM-swap misuse, insider compromise, and authorized push payment (APP) frauds have surfaced, legacy fraud like ATM card cloning has been successfully eliminated.
NeFF has been instrumental in organizing prompt actions, such as industry alerts, public awareness campaigns, mandated two-factor authentication, round-the-clock bank fraud desks, and, most recently, the creation of a Standardized APP Scam Framework.
“A significant step that significantly improves recovery outcomes and limits systemic exposure is the industry’s agreement to reduce fraud response times to less than 30 minutes.”
Ikeazor also emphasized the importance of identification infrastructure in preventing fraud, citing the reduction of impersonation and synthetic identity fraud as a result of the Bank Verification Number (BVN) and its integration with the National Identification Number (NIN).
He stated that maintaining cooperation with the National Identity Management Commission (NIMC) will be essential to bolstering the integrity of the payment system.
According to Oiwoh’s contribution, the overall amount of fraud losses decreased from N52.26 billion in 2024 to N25.85 billion in 2025. Additionally, the number of reported fraud instances decreased by 4% to 67,518 from 70,111 in 2024.
He credited stricter regulations, increased cooperation between banks, security agencies, and regulators, and enhanced fraud detection capabilities throughout the payments ecosystem for the dramatic decline in fraud losses.
“Looking at industry fraud over the past five years, the number of cases has declined significantly,” he stated. Losses increased to N52.26 billion in 2024, mostly due to a single N31.1 billion fraud occurrence involving a single firm. Losses drastically decreased to N25.85 billion in 2025.
“I have to thank the police, DSS, and other security services for their work. Fraud must be reduced as much as possible if financial inclusion is to be attained. It is attainable.
According to Oiwoh, insider misuse has emerged as the biggest concern, and social engineering is still the most common fraud strategy. He continued, “SIM-swap fraud, phishing, and account compromise continue to evolve, highlighting the need for stronger internal controls, staff monitoring, and joint industry action.”
He warned that non-reporting is still unacceptable and voiced alarm about the decline in fraud reporting, which dropped by almost 34% in the final quarter of 2025.
“Tracking and inquiry are made possible by reporting. Because crimes were not recorded, scammers occasionally just migrated from one institution to another, he claimed.
In response, Oiwoh said that the NIBSS created the Person of Interest Portal in collaboration with the CBN, the Nigeria Financial Intelligence Unit (NFIU), and security agencies. As of right now, the portal lists 13,417 people who have engaged in fraudulent activity since 2019. He said that law enforcement organizations were actively using the portal.
Along with the introduction of the National Payment Stack (NPS), which was developed in accordance with ISO 20022 and integrated with advanced security and Nigerian data sovereignty, he also emphasized the expanding significance of AI-driven cybersecurity and digital intelligence capabilities. He said that every instant payment was now risk-scored and that questionable transactions were immediately reported.
In the future, Oiwoh stated that financial knowledge and access to reasonably priced cellphones are still essential to expanding digital inclusion, while the recovery of stolen money is still ongoing.
He emphasized that appropriate BVN and NIN validation using APIs may prevent up to 95% of identity-related fraud, but cautioned that weak account restrictions, poor client profile, and insufficient KYC measures continue to expose institutions to risk.
Dr. Rakiya Yusuf, the CBN Director of Payment System Supervision and NeFF Chairman, stated in her presentation that the apex bank will shortly start inspecting banks to guarantee adherence to ISO 20022 standards and improved use of electronic channels.
She emphasized that all institutions must make sure that appropriate know-your-customer (KYC), know-your-business (KYB), and customer due diligence (CDD) procedures are properly followed, reiterating that there was no “KYC zero” policy.
“We have KYC 1, 2, and 3, with different thresholds,” she stated. When there is no identity at all, there is no KYC known as KYC zero.
“No KYC four policy has been developed by the central bank. Therefore, it will be quite convenient to address them if you have that in your books.
