By Chinenye Anuforo
The rise of digital payment platforms in Nigeria has increased the potential for cyber fraud, with fintech companies now forced to balance between making payment apps user-friendly and prioritising users’ safety to stem cyber fraud.
Chika Nwosu, managing director, PalmPay, said the reason the fintech platform has witnessed astonishing growth in four years was because “we prioritise the safety and security of our users.” He said they’ve been able to achieve this by “marrying security and safety with the customer experience to create a balance.
Continuing, he said: “PalmPay employs a closed-loop risk management system that involves continuous monitoring, analysis, and response to fraud threats and allows it to detect and prevent security risks in real-time and reduce the potential impact of fraud.
“To reduce incidents of fraud, protect their users from fraudsters, and provide a safe banking environment, PalmPay binds their users’ phones to the app and has an auto-logout and biometrics feature to confirm users’ identity.
“Because Palmpay understands that curtailing fraud is a two-way street, it runs a Wallet Safety Workshop to teach users of its app and POS machines various security topics covering payment security and common security issues in daily life, such as password management, fraud detection, phishing and risk identification.
“The safety workshop underscores PalmPay’s understanding of user security as an important part of curtailing fraud and encourages its users to ensure that they always secure their wallets using the several built-in safety features in its app”.
While fintech companies play a role in protecting users from cyber fraud, the rising fraud incidents in Nigeria can sometimes be due to poor digital and financial literacy, but most especially the failure of many victims to report an attack.
In a report last year, Temitayo Oduwole, Head of IT and Payments, PalmPay, observed that customers do not take prompt action in incidents of fraud and that “Only 33 per cent report the same day or take the necessary right action on the same day.”
Effective investigation into incidents of fraud begins when the user reports to their bank that fraud has occurred. However, fraud, if not reported within the hour the crime occurred, allows criminals to move the stolen funds to ‘safe’ places.
“Precaution remains the best remedy to protect oneself from cyber fraud”, anti-fraud expert Tosin Adenekan warned fintech users against trusting strangers with their personal information when performing digital transactions.