Banks Lose N25.85 Billion to Fraud in 2025, NIBSS Reports Significant Drop from 2024
Lagos — Nigerian banks lost a total of N25.85 billion to fraud in 2025, according to data released by the Nigeria Interbank Settlement System (NIBSS) Plc. The figure marks a sharp decline from the N52.26 billion recorded in 2024.
The data also revealed a drop in the number of reported fraud cases across the banking sector, falling from 123,918 in 2021 to 67,515 in 2025.
The Central Bank of Nigeria (CBN) attributed the decline in both the value and volume of fraud to improvements in identity management. CBN’s Deputy Governor for Financial System Stability, Philip Ikeazor, highlighted the role of the Bank Verification Number (BVN) and its ongoing integration with the National Identification Number (NIN) in reducing impersonation and synthetic identity fraud.
Ikeazor spoke at the technical kick-off of the Nigeria Electronic Fraud Forum (NeFF) in Lagos, themed “Shrinking Fraud Losses: ISO 20022 & Identity Management”. He emphasized that enhanced identity verification across banking channels, agent networks, and high-risk digital platforms has steadily closed gaps previously exploited by criminals.
“This underscores the critical role of identity infrastructure as a foundational control for payment system integrity, with NIMC as a key partner in strengthening fraud prevention,” Ikeazor said.
NIBSS Managing Director Premier Oiwoh noted that, despite the decline in fraud losses, digital payment fraud in Nigeria has become more sophisticated, increasing in scale, speed, and complexity due to the growing adoption of instant and remote banking channels.
Lagos remains a primary hub for fraud because of its high transaction volume and dense financial activity, though Abuja and other cities are increasingly emerging as operational bases due to weaker monitoring in some corridors.
Oiwoh also stressed the importance of monitoring the lifestyle of banking staff as a fraud detection measure, noting that such oversight has been neglected in recent years.
NIBSS maintains a Person of Interest portal, which houses records of fraudsters, politically exposed persons (PEPs), and ex-bank staff involved in fraudulent activities. The portal currently lists 114,000 PEPs and nearly 14,000 fraudsters.
The report indicated that web and mobile platforms remain the most frequent channels for fraud, while internet banking, despite fewer cases, accounted for the largest financial losses, highlighting its status as a high-value target.
Oiwoh warned that social engineering, often aided by insider collusion, is now the leading systemic threat, demonstrating that human manipulation, rather than technical compromise, drives most fraud incidents.
The number of institutions reporting fraud also declined from 45 in Q2 2024 to 34 in Q4 2025, raising concerns about potential underreporting that could undermine fraud monitoring and data accuracy. “Fraud reporting to the NIBSS industry fraud desk is mandatory, and penalties for non-compliance must be enforced to protect the ecosystem,” he said.
Ikeazor further emphasized the role of ISO 20022 migration in enhancing fraud detection, stating that the structured data provided by the standard improves traceability, analytics, and early detection of suspicious transactions.
“The adoption of global standards positions Nigeria to confront increasingly sophisticated fraud schemes with modern, data-driven tools,” he said.
He called for the banking industry to set measurable fraud-reduction targets, backed by real-time identity verification, 24/7 monitoring, structured liability-sharing, and active engagement with payment service providers and telecoms.
Dr. Rakiya Yusuf, Director of Payments System Supervision and NeFF Chair, highlighted previous milestones in fraud reduction, including EMV chip-and-PIN cards, two-factor authentication, enhanced consumer protection, and industry-wide fraud information-sharing.
“These interventions helped reduce fraud losses in previous years and maintain public confidence in digital payments. The rollout of the BVN and its integration with NIN has further strengthened identity management, significantly reducing impersonation and fraudulent use of false identities,” Yusuf said.
