In 2024, seven of Nigeria’s leading banks collectively committed N460 billion to bolster their information technology infrastructure in a bid to modernize operations and enhance digital security systems.
These banks — Access Holdings Plc, Guaranty Trust Holding Company (GTCO) Plc, United Bank for Africa (UBA) Plc, Zenith Bank Plc, First City Monument Bank (FCMB), Stanbic IBTC, and Wema Bank — significantly ramped up spending amid a growing reliance on digital transactions across the country.
An analysis by Daily Trust revealed that Access Holdings led the group with an unprecedented N193.5 billion ($120.5 million) allocated to electronic business operations and technology improvements. GTCO followed with a 48% increase to N88 billion ($56.8 million), while Zenith doubled its allocation to N67.3 billion ($43 million). UBA’s tech expenditure jumped by 107%, hitting N48 billion ($30.5 million). Additionally, Stanbic, FCMB, and Wema Bank invested N33.5 billion, N26.3 billion, and N5 billion respectively.
Several factors have driven this surge in technology investment, including the inflationary pressure caused by exchange rate fluctuations, updates to Flexcube — the core banking software platform used by these banks — intensified cybersecurity initiatives, and business expansion into markets like Tanzania, Namibia, and Hong Kong.
- Access Holdings notably recorded a significant improvement following its heavy tech investments, with fraud-related losses plunging by 73%. Despite Access’s progress, other banks saw mixed results. GTCO’s fraud losses dipped slightly from 198.8 million ($123,881) to 159.1 million ($99,421). On the other hand, Zenith Bank experienced a substantial increase, with losses climbing from 383.4 million ($238,914) to 5.26 billion ($3.3 million), underscoring the persistent vulnerabilities and “the pressing need for improved fraud prevention equipment.”
The rapid increase in financial transactions, spurred by the widespread adoption of digital payment platforms, has corresponded with a spike in financial fraud across Nigeria. In a recent report by Cybervergent, a cybersecurity firm specializing in automated digital threat response, it was disclosed that “at least 586,130 cyberattacks from different threat actors rocked Nigeria’s financial institutions and other industries in the first half of 2024.”
Cybervergent’s operations saw 226,103 of these threats resolved through automation. The firm also safeguarded 19,920 endpoints and monitored 304,522 security events via its Security Operations Centre (SOC).
Data from the Financial Institutions Training Centre (FITC) shows a dramatic surge in fraud-related losses, rising from N1.18 billion recorded in 12,066 cases during the third quarter of 2023 to N10.1 billion across 19,007 incidents in the corresponding quarter of 2024. Although this marks a considerable increase, the total value of losses decreased on a quarter-over-quarter basis from N42.8 billion, suggesting that recent security upgrades might be starting to yield results.
Nonetheless, financial crime remains a serious challenge. According to the latest figures from the Nigeria Inter-Bank Settlement System (NIBSS), Nigerian banks lost a staggering N52.26 billion to fraud in 2024. When compared to N17.67 billion in 2023, this represents a dramatic increase of N34.59 billion.
The NIBSS Fraud Report, which monitors both attempted and successful fraud incidents, revealed that “the amount lost to fraud has risen by 196% over the last five years, in line with the expansion of financial transactions in the digital payments industry.”
