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As Nigerian banks continue to launch mobile, online, and e-payment products, finance experts say banks should adopt global solutions to combating electronic related crime.

Those who spoke on the issue said banks have to pay close attention to customer service processes and consider ways to improve them. Commending the efforts of the Central Bank in regulating fraud relating to mobile technology, Ifeoma Monye, a finance analyst at Ciuci Consulting, a management consulting firm, said Nigerian banks need to move quickly with the new trends in technology that eliminate or reduce fraud to the barest minimum.

“Over the years, banking has evolved from the traditional model of customers’ queuing for services in banks to modern day banking, where banking services can be reached through the Internet. Information technology is one of the major issues banks have to deal with as it is more evident that only the banks that have and use their technical resources effectively will be able to have a real competitive advantage in this fast-changing industry.”

She said the issue of financial fraud has also slowed the deployment of such technology, adding that mobile banking has a great potential in Nigeria if regulation is got right and fraud reduced to the barest minimum.

“In order to gain from the benefits that mobile banking offers, the Nigerian financial sector must begin to take necessary steps to align with the related global trends,” she said.

Relief in sight

However, relief may come the way of bank automated teller machine (ATM) card fraud victims as the Central Bank has begun moves to make banks liable for fraud committed on their platform. The Central Bank, in a statement issued last week, stated that banks need to be more responsive to complaints of card fraud by customers.

“It has become necessary to put measures n place, in addition to the existing guidelines to stem this tide” the circular titled ‘Circular on the need to combat card fraud’ and dated August 30, stated.

But Mr. Paul Love, a solutions consultant at ACI worldwide, a provider of application software for electronic payments, said liability of ATM card related fraud was relatively clear. According to him, the card holder and the bank are liable for the loss, depending on the point at which it occurred.

Who is liable?

“From a liability point of view, in normal circumstances, the cardholder is absolutely liable for the transaction. If a card is used after a customer has reported it stolen – the bank should then be liable. But what if the PIN was compromised and the card stolen, and then used before the customer is able to report it to the bank – strictly the customer is liable, but will the bank enforce this in all cases?” he said.

However, the Central Bank in the circular stated in clear terms that banks shall bear the liability for any fraud perpetrated with the use of cards issued without written requests from account holders and directed that no debit card can be issued on an account without a written request from the account holder.

Some banks stated that they are yet to be notified of the circular issued by the Central Bank. A source at Zenith Bank said the embargo on the use of temporary staff in the card management department of banks may mean getting more staff in the industry if the conditions were to be met.

“Yes, this could mean getting more staff to handle card management. We usually send SMS alerts to customers for those who subscribed before, whenever there is an increase or decrease in their account balances, as the case may be, so this is not entirely new. Customers with issues regarding ATM frauds and issues related to their cards are usually directed to state their case at the branch where their accounts are domiciled to be attended to,” he said.

A source at Spring Bank, however, said the category of staff that handle card sections are usually permanent staff due to the nature of that line of service. “The people that handle such issues are trained and experienced professionals, Information Technology experts, because of the sensitivity of that issue.”

The Central Bank stated that appropriate sanctions will be imposed for non-compliance, though it did not state a time limit for the compliance.