From failed transfers and fake debit alerts to identity theft and social engineering scams, ordinary Nigerians increasingly find themselves trapped between banks, fintech companies, telecom providers and switching platforms, each shifting responsibility whenever transactions fail, writes Juliet Umeh.

ON a humid afternoon in Lagos, media practitioner, Louisa Olaniyi, walked into a neighbourhood shop to buy a keg of vegetable oil from a woman she trusted. Like millions of Nigerians embracing the country’s rapidly expanding cashless economy, she paid through a bank transfer.

The N11,600 debit alert appeared instantly on her phone. Satisfied, she left.

Hours later, late at night, the money quietly reversed into her account.

“I was shocked,” Olaniyi recalled. “If I didn’t know the woman personally, I probably would not have gone back to ask whether she got the money or not.”

For her, the incident exposed a troubling reality within Nigeria’s digital payment ecosystem.

“How much is N11,600 for a small businesswoman?” she asked. “That money is a big deal to somebody trying to survive. So who do you report to in that kind of situation? Who takes responsibility?

“These are part of the reasons I don’t do all these quick banking platforms and the rest.”

Across Nigeria, stories like Olaniyi’s are becoming increasingly common as failed transactions, fake alerts, delayed reversals, cyber theft, identity fraud and unresolved disputes continue to erode public confidence in digital financial systems.

When silence becomes the story

What was designed to simplify transactions is gradually becoming a source of anxiety for many Nigerians.

Nigeria’s digital economy expanding rapidly

Behind every transfer, Point-of-Sale, PoS, payment, USSD transaction, mobile wallet, National Identity Number, NIN verification or fintech application lies a vast digital public infrastructure, DPI, quietly powering Nigeria’s modern economy.

Digital public infrastructure refers to foundational digital systems such as identity platforms, payment rails, telecom infrastructure and data exchange systems that enable citizens, businesses, fintech firms, banks and government agencies to interact digitally.

In Nigeria, the infrastructure now supports millions of transactions daily across banking, telecommunications, e-commerce, healthcare, education, transportation and government services.

Data from the Nigeria Inter-Bank Settlement System, NIBSS, showed that electronic payment transactions on the NIBSS Instant Payment, NIP, platform hit an all-time high of N1.07 quadrillion in 2024, representing about 79.6 percent growth from N600 trillion recorded in 2023.

Financial inclusion has also improved significantly. According to the 2023 Access to Financial Services Survey released by Enhancing Financial Innovation and Access, EFInA, formal financial inclusion rose to 64 percent in 2023 from 56 percent in 2020, while overall financial inclusion increased to 74 percent from 68 percent over the same period, driven largely by the growth of fintech services, mobile banking and agency banking networks.

However, experts warn that the same infrastructure driving inclusion is also exposing dangerous vulnerabilities.

When failed transfers become personal crises

For Nsika Samuel, a simple transfer became a two-day nightmare.

Standing in a Lagos market, he transferred money from his Providus Bank account to an OPay account to pay for goods he purchased. The debit alert reflected instantly, but the recipient never received the money.

“I was frustrated because I needed to settle the woman immediately,” he told Saturday Vanguard. “The money had already left my account, but it did not drop. I had to borrow money somewhere else to pay her.”

Samuel eventually recovered the trapped funds after a friend, who worked as an account officer, intervened.

“That was how I got my money back after two days,” he disclosed.

Behind Nigeria’s booming fintech sector lies a growing ecosystem of fear, confusion and weak consumer protection.

From failed transfers and fake debit alerts to identity theft and social engineering scams, ordinary Nigerians increasingly find themselves trapped between banks, fintech companies, telecom providers and switching platforms, each shifting responsibility whenever transactions fail.

Fraud losses rising sharply

Industry figures reveal the scale of the crisis.

According to the latest NIBSS fraud report released in February 2025, financial institutions in Nigeria lost N52.26 billion to fraud in 2024, up from N17.67 billion in 2023, representing an increase of about 196 percent.

The report further showed that although reported fraud cases declined from 101,624 in 2020 to 70,111 in 2024, the actual value lost rose sharply, indicating that fraud incidents are becoming more financially devastating.

Similarly, the Financial Institutions Training Centre, FITC, disclosed in its Q1 2025 Fraud and Forgeries Report that Nigerian banks recorded over N3.3 billion in fraud-related losses within the first quarter of 2025.

The report identified computer and web platforms, mobile transactions and PoS terminals as the most vulnerable digital channels.

Lagos accounted for over 60 percent of reported fraud activities, reflecting the concentration of digital financial transactions within Nigeria’s commercial capital.

Cybersecurity experts say the surge mirrors the explosive growth of Nigeria’s digital payment ecosystem and expanding cyberattack surfaces.

PoS operators trapped between customers and platforms

For small business owners and PoS operators, the consequences are often devastating.

Mrs. Kemi Ogunwale, a Lagos trader, recalled how a customer showed her what appeared to be a successful transfer after her Moniepoint terminal developed network problems.

“Sometimes Moniepoint fails, so I ask customers to transfer into my regular bank account,” she explained.

“The customer showed me a transfer notification, and even a credit alert appeared on my phone. But the money never settled in the account. That was when I realised it was a fake alert.”

For many frontline PoS operators, the dangers extend beyond cyber fraud.

In Ajah, Lagos, PoS operator, Mrs. Rosemary Obong, recounted how she lost money after unknowingly accepting counterfeit cash from a customer.

“A customer came to deposit N100,000,” she said. “I transferred the money from my PoS to his account, but when I checked the cash afterward, most of the notes were fake.”

According to her, only the first and last notes in the bundle were genuine.

“The person had already disappeared before I realised it,” she lamented. “I lost everything.”

For many of PoS operators spread across crowded markets, roadside kiosks and rural communities, such incidents expose the fragile structure supporting Nigeria’s rapidly expanding digital finance ecosystem.

Fraudsters exploiting weak digital awareness.

Increasingly, PoS agents and customers are becoming targets of organised cybercriminals exploiting weak digital literacy and public trust.

An Abia State-based PoS operator narrated how fraudsters attempted to deceive her into releasing sensitive banking information under the guise of a system upgrade.

“They asked me to start reading out my ATM serial number,” she recalled. “But because I already knew about the trick, I intentionally kept giving them wrong numbers until they became frustrated and hung up.”

According to her, “Many unsuspecting victims lose funds once fraudsters obtain critical information such as ATM serial numbers, passwords, dates of birth or verification codes.

“The moment they get your ATM serial number and other details, they can empty the account,” she warned.

What disturbs many operators most, she said, “is the amount of personal information fraudsters already possess before making contact.

“These people already know your name, your number, and sometimes even the bank you use,” she said.

‘The consumer is suffering’

Chairman of the Lagos Chapter of the Association of Mobile Money and Bank Agents in Nigeria, AMMBAN, Mr. Ibirogba Oluwagunwa, said consumers are bearing the greatest burden of unresolved digital payment failures.

“The consumer is suffering while others are enjoying the services,” he said.

According to him, one of the biggest concerns remains failed USSD transactions where customers are debited without successful transfers or timely reversals.

“Millions of Nigerians use USSD daily because many are not tech-savvy enough for banking apps,” he explained. “The transaction fails, but charges are deducted. The money is not reversed quickly, and nobody explains where the money is kept.”

He questioned the accountability process surrounding failed transactions.

“When these transactions fail, where does the money stay? Who keeps it? Why does it sometimes take weeks before customers are refunded or not refunded at all?” he asked.

Oluwagunwa told Vanguard that AMMBAN has begun engaging stakeholders, including the Central Bank of Nigeria, CBN, Shared Agent Network Expansion Facilities, SANEF, and consumer protection groups to improve dispute resolution processes.

National Vice President of AMMBAN, Mr. Yusuf Adeyemo, said many agents often refund customers from personal funds to avoid harassment while waiting endlessly for service providers to resolve disputes.

“It’s like a tug of war,” he said. “Sometimes the platform responds, sometimes they don’t. Meanwhile, the customer is angry and the agent becomes the victim.”

Nigeria records thousands of cyberattacks weekly

Speaking during the IoT West Africa 2026 conference held in Lagos, National Commissioner of the Nigeria Data Protection Commission, NDPC, Dr. Vincent Olatunji, revealed that Nigeria experiences over 4,000 cyber attack attempts weekly.

He added that the NDPC itself records over 1,500 attempted attacks on its networks every week.

Cybersecurity now central to financial inclusion

Cybersecurity and digital trust expert, Prof. Peter Obadare, Chief Visionary Officer of Digital Encode, warned that weak digital trust now threatens Nigeria’s financial inclusion agenda.

“The big elephant in the room is cybersecurity and electronic fraud,” he said during a recent fintech conference in Lagos. “If we want to drive financial inclusion successfully, we must build digital trust.”

According to him, many organisations are prioritising innovation and expansion while neglecting the security architecture required to protect digital platforms.

“Cybersecurity is not a cost; it is an enabler of trust and sustainability,” he warned.

Obadare described many payment infrastructures as “sick systems” vulnerable to attacks because organisations fail to implement foundational security safeguards.

“In cyberspace, if you open your doors, people will invade you,” he said. “Most attacks in Nigeria are not even sophisticated. Many exploit basic weaknesses organisations failed to fix.”

Global cybersecurity research firm, Cybersecurity Ventures projected that cybercrime would cost the global economy about $10.5 trillion annually by 2025, up from roughly $3 trillion in 2015.

Regulators move to strengthen digital trust

As concerns grow, regulators are beginning to strengthen collaboration around Nigeria’s digital public infrastructure.

Recently, the Nigerian Communications Commission, NCC, and the Central Bank of Nigeria, CBN, signed a Memorandum of Understanding aimed at strengthening consumer protection, improving payment system integrity and tackling electronic fraud linked to telecom infrastructure.

The partnership led to the inauguration of a Joint Committee on Payment Systems and Consumer Protection as well as the Telecoms Identity Risk Management System, TIRMS.

Executive Vice Chairman of NCC, Dr. Aminu Maida, said the initiative would help financial institutions verify phone numbers in real time to reduce fraud linked to SIM swaps and recycled numbers.

“This gives financial institutions better visibility and equips them to respond more effectively to e-fraud involving mobile numbers,” he said.

CBN Governor, Mr. Olayemi Cardoso, said the partnership would help build a safer and more resilient digital financial ecosystem.

“Going forward, we remain committed to working with NCC to deliver a safer, more resilient and inclusive digital financial system that protects consumers and strengthens trust,” Cardoso stated.

Why transactions fail despite instant payments

Speaking during a virtual workshop with DPI 2025/2026 Fellows, Head of Strategic and Research at NIBSS, Mr. Williams Uko, explained that while Nigeria’s instant payment infrastructure processes transactions within milliseconds, failures can still occur when one participating institution experiences downtime.

“When you transfer money, the transaction itself happens in milliseconds because the banks are communicating through the NIBSS platform,” he explained. “But if one institution is down, the transaction can time out.”

According to him, NIBSS operates a dispute resolution platform designed to address such failures.

“If the customer does not receive value, the complaint must be logged on the NIBSS dispute resolution platform. Once it is logged, there is a 72-hour resolution timeline,” he said.

Uko, however, noted that some institutions fail to escalate complaints promptly, leaving customers frustrated and confused.

“The usual problem is that some institutions do not lodge those complaints quickly, and the customer thinks the system itself has failed,” he explained.

Between convenience and vulnerability

For ordinary Nigerians already battling inflation and economic hardship, every failed transfer or trapped transaction carries emotional and financial consequences.

Yet digital payments have become unavoidable.

From transport fares and food purchases to school fees, utility bills and market transactions, millions now depend almost entirely on digital systems for daily survival.

For Samuel, the experience permanently changed his relationship with digital. (Vanguard)

Update news