Absa Bank Kenya last year recovered Sh227 million previously lost through fraud and stopped a potential Sh334 million loss as it beefed up its systems.
The lender says in its latest annual report that the recovered amount was seven times the Sh32 million recovered a year earlier when the value of thwarted fraud was Sh498 million.
However, the review period saw Absa book Sh58 million as net losses due to fraud compared with Sh49 million a year earlier. Net losses from fraud refers to the difference between the amount lost and the amount recovered.
Absa noted that cyber security threats continue to require keen vigilance and continuous investments to protect the bank and its stakeholders from cyber criminals. The investments extend to those aimed at identifying and preventing fraud.
“We had an increase in fraud attempts within the control space, particularly affecting our customers through social engineering frauds. To address this challenge, we continue implementing robust security measures and educating our customers on fraud prevention. We aim to protect their assets and maintain trust, thereby supporting a secure banking environment,” Absa said in the report.
The firm said it has been responding by enhancing security measures, training its employees and attracting tech-driven competencies including artificial intelligence (AI) engineers. Absa said AI tools help it predict and access risks that could impact the business in the short, medium and long-term.
Absa discloses that in the year ended December 2024, it upgraded its system, allowing enhanced fraud detection and data analytics to reduce false positives.
False positives occur when non-fraud incidences are flagged as fraud, leading to delays in transactions.
The lender noted that social engineering presents a significant challenge in Kenya, with rapid adoption of mobile and digital money providing an avenue for fraudulent activities to proliferate.
“As the general population has varying levels of digital awareness and literacy, vulnerability to these schemes remains high. In addition, fraudsters continue to evolve and innovate, resulting in new methods to defraud our customers, thus creating the need for consistent vigilance,” Absa said.
A survey by risk and information solutions provider TransUnion released last year ranked Kenya the tenth highest in suspected digital fraud in the first half of 2024 out of nineteen regions.
The survey noted that about 80 percent of Kenyan consumers were targeted by digital fraudsters in the form of email, phone call and text messaging.
Absa adds that it embedded maximum fraud controls in all critical processes, reviewed fraud rules to ensure they are up-to-date and effective and increased the scope of products on system-based fraud monitoring solutions.
