*E-fraud loses to hit N6.1 trillion by 2021
By Babajide Komolafe and Prince Okafor
The Central Bank of Nigeria, CBN, Wednesday disclosed that it has so far resolved 13,715 complaints from banks’ customers with banks refunding N73.27 billion to their customers.
The Director, Consumer Protection Department, CBN, S.K Salam-Alada, made this disclosure today at the ongoing annual workshop for business editors and finance correspondents organised by the Nigeria Deposit Insurance Corporation (NDIC) in Benin, Edo State.
Sam-Alada said the CBN’s Consumer Protection Department (CPD) since it was created has “Conducted a mapping exercise of financial literacy activities in Nigeria; Reviewed the guide to Bank Charges (2004, 2013 and 2017); Resolved over 13,715 complaints resulting in the following refunds to consumers, N66.5 billion, $18.5 million, €26,319.03 and ₤9,085.98, cumulating into a total of N73.27 billion.
Speaking on the trend of electronic payment fraud in Nigeria and its impact on the financial system, Salam-Alada stressed that consumer protection has become imperative against the rising trend of electronic fraud (e-fraud) with loses projected to reach N6.1 trillion by 2021 in Nigeria.
Represented by Ibrahim Hassan, Assistant Director, Consumer Protection Department of CBN, he said: “25,043 cases of fraud were reported by deposit money banks (DMBs) in 2017 compared to 19,531 cases in 2016 representing a 28 percent increase in reported fraud cases in 2017.
“Even though there was a 24 percent reduction in actual fraud loss value in 2017 compared to 2016 figures, Actual fraud loss value amounted to N1.63 billion in 2017.”
He further stated that 83 percent of the e-fraud actual losses in 2017 were electronic fraud, while the remaining 17 percent are non-electronic.
“The volume of and value of e-transactions is projected to continue to increase nationally and globally as result of broader ecosystem scope, the evolution of channels, adaptability to disruptive innovations and modes of payment, increased inclusion and evolving technologies. e-fraud loses projected to reach N6.1 trillion by 2021inNigeria”, he said.
Speaking on the importance of consumer protection in the financial system, Salam-Alada said: “Consumer protection is the whole range of structures, policies, and tools designed to protect consumers from possible abuse and exploitation of financial service providers.
“Consumer Protection has accordingly become imperative to protect not only the consumers of financial services but also the protection of our national electronic payment infrastructure.”
On the mandate of the department, he said that, “The overarching mandate of the Consumer Protection Department (CPD) is to develop and implement an effective Consumer Protection Framework (CPF) that promotes consumer confidence in the financial system.
“The CPF, based on 9 Consumer Protection principles, had been developed and issued to the industry in December 2016. Development of implementation Guidelines that will give full effect to the CPF had commenced with the development of guidelines on 3 of the 9 principles.”
He said disclosed that the CBN may review guidelines on the protection of bank customers adding that the review would begin with an exposure draft, which would spell out areas of consumer protection.