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CBN Pushes AI-Driven Fraud Control Across Nigeria’s Financial System
Central Bank of Nigeria has mandated the deployment of artificial intelligence (AI) and machine learning across all Nigerian financial institutions as part of a sweeping strategy to combat rising electronic payment fraud.
RELATED: NCC joins CBN to unveil Payments System Vision 2028, targeting financial inclusion and $1 trillion economy
The directive, unveiled in the apex bank’s newly released Payments System Vision 2028 (PSV 2028), targets a dramatic reduction in fraud losses to below 0.001% of total transactions by 2028, positioning technology as the backbone of Nigeria’s next-generation payments ecosystem.
‘Innovation with Purpose’ as Policy Anchor
According to the CBN, the AI mandate aligns with its guiding philosophy of “Innovation with Purpose,” which promotes the use of emerging technologies to enhance convenience, efficiency, security, and global competitiveness within Nigeria’s financial system.
While digital payment volumes have expanded rapidly in recent years, the apex bank warned that persistent fraud, cybercrime, and identity-related abuses continue to erode consumer confidence and slow financial inclusion.
Rising Fraud Threats Undermining Digital Trust
The PSV 2028 document highlights key risks threatening Nigeria’s payments ecosystem, including:
- Cyber-attacks and phishing schemes
- Identity theft and account takeovers
- Social engineering and authorised push payment (APP) fraud
- Unauthorised and manipulated transactions
According to the CBN, these challenges have weakened trust in digital financial services and constrained broader adoption, particularly among underserved populations.
AI at the Centre of PSV 2028 Strategy
Under the innovation and emerging technologies pillar of PSV 2028, the CBN disclosed plans to aggressively deploy:
- Artificial Intelligence and Machine Learning
- Blockchain-enabled payment solutions
- Programmable and automated payment systems
These technologies are expected to modernise Nigeria’s payments infrastructure while shifting fraud management from manual, reactive processes to proactive, data-driven systems.
Key Mandates for Banks, Fintechs, and Payment Providers
The new framework introduces several compulsory initiatives across the financial ecosystem:
- Automated AML Systems:
All banks, fintechs, and mobile money operators must deploy AI-powered Anti-Money Laundering (AML) solutions capable of real-time monitoring. - Real-Time Transaction Surveillance:
AI algorithms will analyse millions of transactions instantly to detect anomalies, behavioural shifts, and advanced fraud patterns. - Geo-Tagging of PoS Devices:
Payment providers must embed geolocation features in Point-of-Sale terminals to flag or disable devices operating outside registered locations. - Cross-Industry Data Integration:
The CBN will integrate national identity infrastructure from National Identity Management Commission with telecom systems regulated by Nigerian Communications Commission to strengthen cyber policing and digital traceability.
Industry-Wide Fraud Intelligence and Monitoring
To reinforce enforcement, the CBN plans to establish:
- A centralised Security Operations Centre (SOC) for the financial sector
- A national fraud intelligence-sharing platform
- Shared infrastructure for risk analytics, compliance, and threat detection
- Industry-wide cyber performance monitoring frameworks
These measures aim to improve coordination, speed of response, and systemic resilience against evolving cyber threats.
Beyond Fraud: AI to Transform Payments Operations
Beyond security, the CBN noted that AI is already reshaping global payment systems through:
- Chatbots and self-service platforms
- Robotic process automation
- Intelligent customer support and dispute resolution tools
Locally, AI adoption is expected to enhance transaction monitoring, streamline compliance, and improve overall service delivery across payment platforms.
Positioning Nigeria as a RegTech and SupTech Leader
By 2028, Nigeria aims to emerge as a leader in technology-driven regulation, advancing:
- Regulatory Technology (RegTech)
- Supervisory Technology (SupTech)
- AI-powered compliance and oversight systems
The CBN also revealed ambitions to export Nigeria-developed digital payment frameworks and regulatory solutions to international markets.
A High-Stakes Shift as Digital Transactions Surge
With electronic payment transactions exceeding ₦1.2 quadrillion in 2025, the apex bank said the AI mandate reflects the urgency of safeguarding Nigeria’s rapidly expanding digital economy.
The PSV 2028 framework signals a decisive shift from rule-based fraud detection to predictive, AI-powered risk management, reinforcing Nigeria’s ambition to build a secure, inclusive, and globally competitive payments ecosystem.
