Telecommunications giant; Safaricom has launched its very own fraud intelligence solution for financial institutions in Kenya.
The Safaricom owned service will help banks, insurance firms, and micro-finance institutions, to reduce incidences of fraud targeted towards their customers.
Safaricom aims to do this by providing the financial institutions with a tool which aids in determining the authenticity of a financial transaction.
Besides authentication, the solution will also provide financial institutions with the ability to enhance the registration and onboarding of new customers, design their lending propositions better, and also manage the phone numbers linked to a customer’s accounts, but may no longer be in use.
It works across three channels; applications on smartphones, USSD, and internet banking.
The use of smartphone applications, USSD, and internet banking as banking channels, has been on the rise in Kenya and corresponds with the increase in internet and smartphone usage.
Banks, insurance firms, and micro-finance institutions will access the service through an API provided as part of the Daraja M-PESA APIs.
The moment a customer attempts to log in via applications on smartphones, USSD, and internet banking, the institution will then run the customer’s phone number through the service to check against parameters such as if a customer’s number has been recently swapped.
The financial institutions, can then factor in the result of the check to complement internal fraud rules and to arrive at a decision on whether to allow the transaction or to authenticate the customer further, through other methods.
In 2019, more than 3.5 million Kenyans use mobile and internet banking services within the East African nation every month.
The adoption of the solution by Safaricom, is expected to benefit Kenya through increased usage of mobile and internet banking as a result of an increase in confidence from both the financial sector and customers as well.
Safaricom’s Chief Financial Services Officer; Sitoyo Lopokoiyit, stated that, “Through the years, we have developed in-house capabilities that have helped us cut down on attempted fraud incidences targeting our customers by more than 75 percent.”
Sitoyo Lopokoiyit added that “Today, we are launching a solution that will provide these world-class capabilities to our enterprise customers in the financial sector, empowering them to make more informed decisions when interacting with their customers in the digital space.”
