Experiencing huge losses in 2023, Nigerian banks are starting to raise concerns with regards to the stability of the online gaming industry in the country. In a recent report by the NIBSS (Nigeria Inter-Bank Settlement Systems), local banks have already suffered a loss of around N9.5 billion this year, which amounts to approximately $12.1 million to put things in perspective.

This was reported during the Q3 meeting of the NeFF (Nigeria Electronic Fraud Forum) that was held in Lagos, where the topic of electronic fraud and cyber-crime was flagged as one of the main causes for concern. According to NIBSS’s Chief Risk Officer Temidayo Adekanye, cashless policies imposed by the CBN (Central Bank of Nigeria) have resulted in a “dramatic increase in the volume of transactions” within the online gambling sector, which in turn resulted in an additional increase of fraudulent activity within the industry.

Adekanye expressed his concern with regards to the dangerous hike in fraudulent activity within Nigeria’s financial sector, specifically when it came to online gambling. This is precisely why real money online casinos and their banking options need to be properly evaluated by customers. Just like when a player is vetting providers and verifying their reputability, their payment methods should also be considered. We found that NoDeposit365 did the best job of listing vetted providers.

Seeking Collaboration

The Managing Director went on to highlight the severity of this issue and the ways it’s currently impacting the industry by comparing data from prior years. During this time, he went on to explain that by comparing the last five years of data, losses caused by fraud increasing dramatically over the past five years. 

With a significant increase of fraud losses between January and July 2023, “we’re looking at a loss of N1.2 billion ($1.5 million), which is a 54% increase”. He then went on to highlight that most fraudulent activity stemmed from point of sale (POS) agents, or e-wallets. Now when you keep in mind that the e-fraud recovery rate stands at around 5% nationwide, the Adekanye called for a broad-base partnership among stakeholders to help combat this new reality. Suggestions included increased KYC procedures when it comes to POS agents, sports betting accounts and crypto gambling amongst others. 

Time to Level Up

During his speech, Musa Jimoh a director at CBN and Chairman at the NeFF also called on this partnership, emphasizing that cyber criminality is on the rise, and could result in major losses for both organizations as well as individuals if not properly addressed. He pointed out that there has never been a better time to address the subject and encouraged steak holders to “work together to see how we can make life extremely difficult for cyber criminals”. 

Final Thoughts

In his closing statement, the Chairman urged for increased education and awareness, highlighting that since online transactions are consistently on the rise, this has also opened the door to new opportunities for cyber criminals to target the most vulnerable.