By Victor Adar
One of the commonest forms of financial service scams is SIM swap fraud, which over 90% of Kenyan banking leaders identify as an issue for their organisations. When a customer lets their operator know that their SIM card is damaged, lost or stolen, the SIM is deactivated and a new one is issued.
Since-last year, incidences of SIM card fraud have risen, perhaps testament to the fact that this recently prevalent crime has gained in the country.
In response, although not specifically targeted at this particular crime, government enacted the Computer Misuse and Cybercrimes Act (2018), a law that is expected to help in the fight against the rampant digital fraud. Tellingly, it also contains some offensive items that have been roundly condemned as an attempt by government to muzzle free speech.
But the law has also seen investment in the digital fraud front.
Mobile technology firm, Myriad Connect, is one of the first private sector players to see a market and grab the opportunity to tackle SIM swap and digital financial transaction fraud.
According to its general manager, Fabien Delanaud, combating digital transaction fraud is no easy task, as turning around demands a well thought out prevention strategy. To the mobile technology specialist, the channel chosen ought to provide universal authentication to any mobile device, regardless of data connectivity.
Citing recent research which reveals that over 70% of Kenyans have been the victims of financial fraud or know someone who has, Delanaud is confident that out of band authentication and SIM swap detection solutions will add value to the local market.
“Financial service transaction fraud in Kenya is costing banks billions and customers their life savings,” says Delanaud. “While financial service transaction fraud is a global issue, Kenya has been a leader in the adoption of mobile and digital payments, which unfortunately brings with it a growing risk of fraud.”
The firm’s authentication service delivers a separate, third party authentication channel on any mobile device. Using Unstructured Supplementary Service Data, popularly known as USSD, it is able to provide an entirely out of band channel for authentication, with all interactions transmitted over the mobile network, which is separate to the browser or online channel being used by the customer to initiate the transaction. The session-based service for example, sends an advanced push notification to open up a conversation between the enterprise and its customer.
In addition, Myriad’s SIM Swap detection service provides a real time check on the SIM, while no persistent data is held with any third party, providing a more secure service than current two-factor authentication.
A clear audit trail is also established, where the user’s identity is verified by a party external to the transaction. This results in a technology that greatly enhances the security of transactions vulnerable to SIM swap fraud.
At a time when users are neckdeep in a pool of scams, many questions still remain unanswered: has the technology worked in other countries, and will it enhance customer engagements while improving service delivery, regardless of device or connection? (