Many countries of the world have adopted e-banking system and are reaping its benefits of convenience among others. But the case is different in Nigeria where consumers are scared of exploiting the avenue for fear of cyber attacks which is a chief problem that banks are yet to confront.
Some of the respondents have this to say: Many banks simply don’t know how to go about e-banking? I have seen some fraudulent debits to my accounts and the bank in question was just helpless! They would ask you to call a phone number, and the person that picks up the call in turn would ask you to wait while he transfers the call to the appropriate person etc! I believe this is their own way of buying time! Some other banks will send you dispute forms to complete and return to them. When you are tired, you forget it! My advice to people is never to tie all their accounts to any one Card! You may tie only your current account to your Credit/Debit Card leaving your savings account safe so you have something to fall back on in the event of a fraud on your account.
Another who identified herself as Mobolaji Moyosore said, “until CBN makes the banks liable for any fraudulent activities reported by the consumer – within a specified number of days – e-banking will never take off. Yes it’s convenient but consumers are not stupid enough to risk losing their hard earned money without any sort of protection whatsoever.”
However, Cyber security experts have predicted an increase in cyber crimes in line with the growing usage of the internet.
The Central Bank of Nigeria’s report for the first half of 2013 indicated that there were 2,478 fraud and forgery cases involving Nigerian banks valued at over N20 billion.
This represents an 8 percent increase over the previous year volume but a considerable increase in value of over 200 percent from 2012.
Between year 2000 and 2013, Nigerian banks have lost an estimated N159 billion to electronic frauds and cyber crimes according to reports by the Nigerian Inter-bank Settlements Systems (NIBSS).
Taiwo Longe, Chief Information Security Officer, Central Bank of Nigeria (CBN), while speaking at the recent National Cyber Security Forum (NCSF 2014) was keen to highlight the growing rate of cyber crimes in the country.
“With the growing threat of cyber criminals, the need for a policy framework to address the menace has become more imperative now than ever before,” he said.
Internet usage in Nigeria has grown exponentially, currently ranked 8th globally, and as a result; an increased amount of online activities in the country.
The proliferation of Smart phones as well as increasing broad band penetration has presented banks in the country an opportunity for a wide customer reach at a much cheaper cost.
With the cashless initiative going into full swing across the country, e – banking take-up is yet to witness an exponential increase as initially expected.
Studies conducted by KPMG on the banking sector indicated that for customers aged 30 and below, eight-in-ten customers never used internet banking. Perhaps the issue of reliance/security in terms of e – banking activities has been a major hitch.
According to the survey, “An overwhelming number of corporate customers (95 percent) rated security of their online corporate solution as their most important element of online banking.”
Despite the fact that the adoption of e – banking in the country has provided some measure of convenience and ease to customers, it is almost impossible to ignore the consequential security risks associated with its adoption.
The burgeoning popularity and convenience of e – banking has further presented an enhanced opportunity for cyber crimes in the country.
Technology is increasingly more powerful and inexpensive not to mention the proliferation of smart devices which translates to more sensitive information in more places and greater susceptibility to theft
According to the KPMG survey on the Nigerian banking sector, “2 percent of retail customers indicated that they had experienced a fraud incident in the last year.”
Although 2 percent appears diminutive today, it may however, indicate the start of a potentially disturbing trend in the country.
While analysts estimate global losses to cyber crime to be over $400bn annually, recent cyber attacks on JP Morgan Chase and a handful of other U. S. Banks is an indication that cyber crime is here to stay.
As the Nigerian economy heads towards a cashless society, the adoption of e-banking is undoubtedly necessary. E-banking users are a potentially attractive customer segment for banks in the country.
In a bid to tap into this potential market segment, banks must address the issue of cyber attacks.
An emphasis should be laid on the deployment of fraud detection solutions which could help guard against fraud and also protect customers against e-channel frauds.
Accordingly, bank security measures should be positioned along the domains of preventive, detective and response measures and in the areas of people, processes and technology, particularly in high risk technical areas such as email servers, ERP systems, Web application servers and several others.