The Nigeria Inter-Bank Settlement Systems said the most common fraud technique in the Nigerian banking sector and digital payment system is social engineering.

Managing Director of NIBSS, Premier Oiwoh, disclosed this on Wednesday at an event in Lagos, noting that digital payment declined by 51 percent in Nigeria to N25.85 billion in 2025 from a high of N52.26 billion in 2024.

Oiwoh noted that within the category of fraud, insider abuses or involvement have been the greatest threat.

According to him, by channel, fraud remains most prevalent in e-commerce and internet banking, followed by point of sale, mobile, and web platforms within the Nigerian banking and fintech sector.

He further said incidents such as SIM swap fraud, account compromise, and phishing continue to evolve in the country’s banking sector.

“Last year alone, coordinated actions saved about N20 billion that could have been lost,” he revealed.

“The most common fraud technique remains social engineering. Within this category, insider abuse is the greatest threat we face. Insider involvement is high, and recent investigations have confirmed this. Services such as SIM swap fraud, account compromise, and phishing continue to evolve.

‘Awareness remains critical, as many victims are still easily deceived,” he said.

He added, “In 2023, actual losses stood at about N17.67 billion. In 2024, losses rose to N52.26bn, largely driven by a single fraud incident of N31.1bn involving one entity. In 2025, losses dropped significantly”.

As a solution, Oiwoh urged that, “we must prioritize internal controls, monitor staff activities closely, and pursue consistent joint industry action. Trust among institutions is essential.”

He noted Lagos State remains the Nigerian state with the most prevalent fraud at 63 percent, followed by Abuja, Ogun, Rivers, and Delta States.