Enter your email address below and subscribe to our newsletter

Digital Fraud in Tanzania’s Commercial Banks increased by 84% at the End of 2023

By Oluchukwu Ikemefuna

Share your love

Digital fraud by commercial banks increased by a substantial amount of 84% in the last three months of 2023. The Bank of Tanzania (BOT) revealed this shocking information in a circular passed to commercial banks on March 5.

Digital Fraud

Some of the common digital fraud in Tanzania commercial banks include:

  • Online frauds or phishing attacks: This is when scammers trick people into releasing their personal details through deceptive emails or websites. 
  • Card skimming: Fraudsters capture card information at the ATM machine or POS terminal to make unauthorised withdrawals.  
  • Identity theft: Fraudsters get people’s personal data information and make transactions, thereby causing debt. 

Breakdown Of Digital Fraud In Tanzania Commercial Banks 

Through Online Fraud 

The digital fraud report was compared to the report from July to September. According to East African news, the central bank claimed that more than Tsh1.65 billion ($647,000) was drained out through mobile and internet banking fraud, including cyber-attacks, during the fourth quarter of the year, a sharp increase from Tsh901.8 million ($353,600) in Q3.

The figure was below Tsh1.66 billion ($650,980) recorded in the first quarter of the year but highlighted a steady rise in online fraud over the next three quarters after dropping to Tsh674.06 million ($264,340) in Q2.

Digital Fraud from Card Skimming 

Theft from automated teller machine card skimming also went up a whopping 60 percent to Tsh159.87 million ($62,700) in Q4, compared with Tsh99.64 million ($39,100) in Q3, although nowhere near Tsh424.16 million ($166,340) in Q2.

Through Identity Theft

But Q4 registered the lowest value of theft through forged cheques and the Tanzania Interbank Settlement System for the year at Tsh11.3 million ($4,430) against Tsh34 million ($13,330), Tsh954.59 million ($374,350), and Tsh20.9 million ($8,200) for Q1, Q2 and Q3 respectively.

The central bank’s Directorate of Financial Sector Supervision made a comprehensive breakdown of the theft that went on in commercial banks so as to make commercial banks vigilant to secure the databases of their customers and to investigate any digital fraud that might be going on. 

“We expect them to use this feedback to improve their internal controls in order to minimise future losses due to fraud,” the director said.

Ways The Tanzania Commercial Banks Can Stand Against Digital Fraud

  • Making use of Artificial Intelligence and Machine Learning algorithm: These two can help analyse databases and detect systems that might  encourage fraudulent actions.
  • Through Transaction Monitoring: This analyses transactions and flags down unusual transaction patterns from unfamiliar locations.
  • The Use Of Two factor Authentication (2FA):  This adds an extra layer of security to a user account. It requires users to provide two different forms of identification: unique codes and passwords sent to their devices before accessing their accounts.
  • Biometric: This is the use of facial recognition or a fingerprint to access accounts. 
Share your love
Abdullahi Kafayat
Abdullahi Kafayat

Abdullahi Kafayat is an enthusiastic writer interested in the tech world. She's a graduate of Obafemi Awolowo University and has a BSc in Chemistry. You can reach her at Kafayatabdullahi17@gmail.com.

Articles: 192

Newsletter Updates

Enter your email address below and subscribe to our newsletter

Stay informed and not overwhelmed, subscribe now!