Tips to protect your bank account from fraud
With bank fraud on the rise in Nigeria’s digital banking landscape, experts share tips on how individuals can protect their funds from unauthorised access, JUSTICE OKAMGBA writes.
The rise of digital banking in Nigeria has brought convenience to millions, offering seamless financial transactions at the click of a button.
However, this rapid shift to digital platforms has also opened new avenues for financial fraud, putting customers’ hard-earned money at risk.
In 2024 alone, Nigerian financial institutions lost N52.26bn to fraud, according to the Nigeria Inter-Bank Settlement System report released on Wednesday. This marks a staggering increase from N17.67bn recorded in 2023—a difference of N34.59bn in just one year.
While the number of reported fraud cases declined by 31 per cent in the last five years—from 101,624 cases in 2020 to 70,111 cases in 2024—the amount lost rose by 350 per cent within the same period, indicating that fraudsters are becoming more sophisticated.
With digital payments becoming more widespread, safeguarding bank accounts has never been more crucial. But how can individuals protect themselves from falling victim to financial fraud?
Experts share insights on the best practices to secure bank accounts and prevent unauthorised access.
Suspicious calls and messages
One of the most common tricks used by fraudsters is impersonating bank officials to request sensitive information under the guise of solving account issues or upgrading services.
A banker, Somya Gharwar, warned against sharing personal banking details under any circumstances.
“No true banker will ask for your Aadhaar number, debit or credit card details, CVV, or OTP over the phone,” she said. “If someone claims to be from your bank, simply ask them to visit the branch in person.”
Fraudsters often pressure victims into sharing information by creating a sense of urgency, such as threatening to block the account or suspend services.
Gharwar advised that if you mistakenly share your card details, the first step is to block the card immediately or transfer your funds to another account via online banking.
Securing digital identity
Many fraudsters gain access to bank accounts through information found online. Oversharing personal information on social media can unintentionally make users vulnerable.
The Chief Executive Officer of Castle Point Capital Management, Donald Gallagher, highlighted how easily fraudsters can piece together identities from publicly available information.
Fraudsters need just three pieces of personal information to steal your identity—your name, date of birth, and address. Most of this information is readily available on social media,” Gallagher said.
To minimise risks, Gallagher recommends avoiding posting sensitive information online, using unique passwords for every account, and enabling two-factor authentication wherever possible.
Two-factor authentication provides an extra layer of security by requiring a second verification code sent to your phone or email before transactions can be completed.
Account monitoring
Frequent account monitoring can help detect unauthorised transactions early. Many banking apps now allow customers to set up instant alerts for every transaction, making it easier to spot suspicious activity.
Financial commentator Starr Callies advised checking bank accounts regularly to stay ahead of fraud attempts.
“You should be checking your bank account at least once a day. If you suspect your card has been compromised, call your bank’s fraud department immediately, Callies said.
Banks are typically liable to refund fraudulent transactions if reported promptly. However, Gallagher cautions that the likelihood of reimbursement decreases over time, making immediate reporting essential.
Strong passwords and two-factor authentication
Passwords are the first line of defence against bank fraud. Using weak, predictable passwords can leave accounts exposed to hacking attempts.
An account manager at Bitcoin Mining, Jack Allen, stressed the importance of using unique and complex passwords for each account.
“You probably know that having a strong password is important, but it’s equally crucial to use different passwords for each account. Leverage two-factor authentication whenever possible,” Allen said.
He advised using password manager applications to generate and store complex passwords securely.
Two-factor authentication adds an extra layer of security, making it significantly harder for fraudsters to gain access even if they manage to obtain your password.
Offline banking information
Fraud isn’t limited to digital platforms—physical banking documents can also make customers vulnerable if not properly secured.
A financial analyst, Gauri Sankar, warned that many customers are careless with items like chequebooks, specimen signatures, and PIN numbers.
“Many customers are careless with their chequebooks, specimen signatures, and PIN numbers. Allowing family members or outsiders access to these documents increases the risk of unauthorised transactions,” Sankar said.
He recommended keeping banking documents in a secure place and never sharing login credentials or PIN numbers with anyone—even close relatives.
Warning
If you realise you’ve fallen victim to fraud, the first step is to contact your bank immediately.
Most banks have dedicated fraud departments to investigate suspicious transactions. Gallagher explained that banks are obligated to refund customers if the fraud is reported quickly. However, the responsibility shifts if there is a delay.
“Contact your bank immediately to let them know what’s happened. Most banks should reimburse you if you’ve transferred money due to a scam, but only if you report it on time,” Gallagher said.
Banks typically investigate fraud claims within seven to fourteen business days, but delayed reporting could weaken the chances of a full refund.
Staying ahead of scammers
Fraudsters are constantly evolving their tactics, making it vital for customers to stay one step ahead. Simple habits like updating passwords regularly, enabling two-factor authentication, and monitoring account activity can significantly reduce the risk of financial fraud.
Cybersecurity experts recommend updating passwords every three to six months and never using the same password across multiple platforms.
Additionally, customers are encouraged to register for their bank’s fraud alert services and avoid using public Wi-Fi for online banking transactions.
