By Peace Udugba -The daily torch media
Nigeria’s digital banking revolution is raising the stakes for consumer trust. The question is whether the industry is rising to meet them.
Nigeria’s relationship with digital banking has changed almost beyond recognition in a decade. Where cash once dominated every transaction—from roadside markets to corporate boardrooms—mobile apps, instant transfers, and USSD codes have reshaped how tens of millions of Nigerians interact with money every day.
The figures speak for themselves: point-of-sale transactions surged to a record N18 trillion in 2024, a 69 per cent increase from the previous year, while the number of POS terminals more than doubled to 5.5 million. Mobile banking is now the most widely used digital financial service in the country, with four in five users accessing it within any 90-day period.
This is, by any honest measure, an extraordinary story of financial inclusion and technological adoption. But it is an incomplete story if told without its other half.
Behind the growth curves and transaction volumes, a quieter and more troubling narrative has been unfolding. According to the 2024 Nigeria Consumer Protection Survey published by Innovations for Poverty Action, nearly one in four digital financial services users reported experiencing unexpected fees, charges, or fraud attempts in the past year. Of those who encountered problems, only half sought formal redress. That silence is not apathy—it reflects eroded confidence: customers who no longer believe complaints will lead to resolution.
Data from the Nigeria Inter-Bank Settlement System tells a similar story from another angle. Actual losses to digital payment fraud rose to N52.26 billion in 2024, a figure significantly inflated by a single N31.1 billion incident involving one institution, but still representing a 196 per cent increase in fraud losses over five years, even as the number of reported cases declined.
The decline in case numbers is not reassuring. It suggests that while fraudsters may be making fewer attempts, each successful attempt is becoming far more damaging.
By channel, e-commerce and internet banking remain the most exposed, followed by point-of-sale, mobile, and web platforms. The most common technique is social engineering—requiring no sophisticated technology, only a convincing conversation and an uninformed customer. Insider abuse, where bank staff are complicit in fraud, has also been identified by NIBSS as a major structural threat to the sector.
This is a sobering finding that no institution should overlook.
Collectively, the data points to a widening gap the industry must confront honestly: Nigeria’s digital banking infrastructure has expanded rapidly, but the consumer protection architecture has not always kept pace.
Convenience and safety are not natural enemies, but they require deliberate and sustained design to coexist. When they evolve at different speeds, they create precisely the conditions that fraudsters, rogue actors, and weak controls exploit.
The encouraging news is that progress is being made. Nigeria exited the Financial Action Task Force’s grey list in 2025, signalling that the country’s financial safeguards have materially strengthened. The Central Bank of Nigeria’s 2024 rollout of risk-based cybersecurity frameworks for deposit money banks has further formalised the standard of care expected of financial institutions.
Regulatory enforcement actions in 2024, including reported industry penalties exceeding N15 billion, have also reinforced that consumer protection is no longer optional—it is a compliance obligation with real consequences.
Within financial institutions, the most effective safeguards are often invisible to customers. Strong security systems operate quietly in the background—monitoring account behaviour in real time, detecting anomalies before losses occur, and intervening before suspicious transactions are completed.
This is not glamorous work, but it is essential. A customer who never experiences fraud has been better protected than one who receives an apology after the damage is done.
Union Bank of Nigeria provides a useful illustration of what this balance looks like in practice. According to its full-year 2025 customer experience data, its digital channels recorded strong satisfaction levels: UnionMobile achieved a customer satisfaction score of 87 per cent and a net promoter score of 77, while its USSD platform (*826#) recorded 82 per cent and 70 respectively.
These figures are not driven by convenience alone. They reflect what customers value most in digital finance: confidence that transactions will be safe, seamless, and completed without disruption.
That confidence is built through sustained investment in security infrastructure, proactive monitoring systems, and an institutional culture that treats customer protection as a core responsibility rather than a compliance requirement.
At Union Bank, this culture is expressed through its ICARE values, where customer and community focus is embedded as a guiding principle and reinforced across every level of the organisation.
In March, as financial institutions marked World Consumer Rights Day, Union Bank reaffirmed its internal commitment to customer protection and accountability across all staff levels. While such commitments rarely make headlines, they ultimately shape the quality and safety of every customer interaction.
Trust remains the only currency in banking that cannot be manufactured. It is built over time through consistency, accountability, and systems that protect customers before they are even aware of risk.
Nigeria’s digital banking revolution has already transformed financial access and participation. Its next chapter must be defined equally by financial safety. The two are not in competition—in practice, they are inseparable.
