Banking Fraud Types on the Rise in Namibia, Says Bank of Namibia
National Payment System Experiences Significant Increase in Fraudulent Transactions
The national payment system (NPS) has witnessed a substantial surge in fraudulent transactions over the past five years, according to the latest report by the Bank of Namibia (BoN). The total value of fraudulent transactions perpetrated within the NPS has increased significantly, with card fraud rising by 9%, EFT fraud increasing by 80%, and e-money payments fraud growing by 62%.
Fraudulent Transactions by Type
- Card Fraud: Increased primarily due to card-not-present payment incidents via internet banking platforms or mobile applications.
- EFT (Electronic Funds Transfer) Fraud: Mainly perpetrated through phishing attacks.
- e-Money Payments Fraud: Resulted from phone scams targeting wallets.
Total Value of Fraudulent Transactions in 2022
| Stream | Total Value |
|---|---|
| Card | N$7.4 million |
| EFT | N$14.5 million |
| e-Money Payments | N$9.6 million |
Currency Management and Counterfeits
- Currency in Circulation: Increased by 2.4% in 2022, driven by an increase of 15.7% for the N$10 banknote and 7.9% circulation for the N$30 commemorative banknote.
- Coin Circulation: Increased by 3.5%, attributed to the discontinuation of minting the 5-cent coin in 2018.
- Counterfeits: Recorded a total of 206 counterfeits in 2022, up from 155 in 2021 (a 32.95% increase).
- Denomination with Most Counterfeits: N$200 banknote denomination at 55.8%.
Efforts to Combat Counterfeiting
- Despite the increase, the BoN emphasized that counterfeits remained of poor quality and below the industry standard.
- The bank has managed to effectively control the issuance of new currency into the market, with the N$10 and N$200 denominations remaining the most distributed.
Conclusion
The Bank of Namibia’s report highlights a significant increase in fraudulent transactions within the national payment system. While counterfeits are on the rise, the bank’s efforts to combat counterfeiting have yielded positive results, with a steady decline in the volume of counterfeited banknote pieces over the past five years.