Safaricom (NSE: SCOM) has introduced a fraud intelligence solution for financial institutions to address the increasing incidents of fraud related to SIM swap.
The service will enable financial institutions to check with Safaricom if there has been a SIM swap on the network and discontinue any requested transactions.
In addition to authentication, the solution will also provide financial firms with capabilities to better design their lending propositions, enhance the registration and onboarding of new customers, and also in managing phone numbers linked to a customer’s accounts but which may no longer be in use.
“We need to provide security and safety to market the product and services to our customers. This product enables financial institutions to check whether there is a SIM swap in our network. These things (SIM Swap) happen every day,” said Sitoyo Lopokoiyit, Chief Financial Services Officer, Safaricom.
“The API will work on the GSM network, but also on Safaricom’s app and internet banking for the financial institutions,” added Lopokoiyit.
- How well does Your Bank Know You? The KYC Process
- Kenyan Customers Value Mobile Banking But Not Ready for Robotic Agents
- What is a ‘Source of Funds’ check and how does it affect you?
The solution works across the three channels including USSD, internet banking, and smartphone apps. Such banking channels have been on the rise in the country corresponding with increasing internet and smartphone usage.
Once a customer attempts to log in through any of the channels, the institution will then run the customer’s phone number through the service to check against such parameters such as if a customer’s number has been recently swapped. Institutions can then factor in the result of the check to complement internal fraud rules and to make a decision whether to allow the transaction or if to further authenticate the customer through other methods.
According to Safaricom, they have already seen success with the solution enabling the telco cut down attempted fraud by more than 75%.