Fintech employs AI for fraud detection

Chika Nwosu, the Managing Director at Palmpay Nigeria, has said that the firm has begun employing Artificial Intelligence (AI) to combat fraud.

Nwosu, speaking on the sidelines of the firm’s fifth anniversary, acknowledged the challenges the fintech is facing, especially those related to fraud.

“We have faced different challenges, and we are working on them. Recently, there has been a rise in fraud. However, we have gotten some AI and fraud monitoring tools to combat them,” he said.

Globally, fraud cases have been on the rise because of the boom of electronic payments. Over N59 billion has been lost to fraud in Nigeria in the last five years. In 2023, over 80,000 Nigerian bank customers were defrauded.

The MD noted that curbing fraud incidence is crucial. He also highlighted that financial inclusion remains Palmpay’s core focus. He stated that people without smartphones will soon be able to participate in the digital financial ecosystem.

Read also: Here are ways open banking can boost Nigeria’s fintech market

Nwosu said, “The future is about deepening financial inclusion. We want to reach the last man; the people who do not even use smartphones. We are all about using technology to support financial inclusion in Nigeria and on the continent.”

According to the MD, Palmpay has grown since its launch five years ago. Its user base has grown to over 35 million, and the company processes 300 million monthly transactions. Its total transaction value has exceeded N6 trillion, and it boasts a network of 1 million mobile merchants and vendors.

The fintech’s new user base is a 34,900 percent increase from the 100,000 it had in November 2019. In the first seven months of 2024, the Nigeria Interbank Settlement System (NIBSS) recorded that mobile money transactions grew by 74 percent to N41.5 trillion.

According to Nwosu, despite the fintech’s growth, it has also had to navigate murky regulatory waters. “There were times when regulations impacted customer onboarding, indirectly affecting new user acquisition. The past five years have been about problem-solving, innovative thinking, and enabling Nigeria’s financial economy,” The MD said.

As Palmpay celebrates its fifth anniversary, Nwosu noted that the fintech remains committed to bringing financial empowerment to every corner of the country.