Nigerian banks urged to scale up cybersecurity investments as fraud losses surge

Cybersecurity experts have warned that Nigerian banks and financial institutions must urgently raise their investments in digital security as the costs of cybercrime continue to escalate.

According to the Nigeria Inter-Bank Settlement System (NIBSS), the sector lost ₦52.26 billion to fraud in 2024, a sharp 195 per cent increase from the ₦17.67 billion recorded in 2023. The rise has been linked to the growing sophistication of hackers who are leveraging artificial intelligence (AI) and cloud-based tools to breach financial systems.

Speaking at a cybersecurity forum organised by technology firm Bitscape, its Executive Director, Mr. Nonso Magulike, stressed that the pace of innovation in AI and cloud technologies demands a corresponding upgrade in banks’ defences.

“The evolution of cloud and AI is moving very quickly. This means that bad actors can do things at a rate that is quite high. So, banks need to keep investing,” he said. While acknowledging that many institutions are making progress, he added that vigilance remains essential for every business in the financial services ecosystem.

Magulike explained that the forum was aimed at helping businesses, particularly small and medium-sized enterprises (SMEs), understand that cybersecurity solutions need not always be expensive. “Some larger banks have big budgets for cybersecurity, but smaller organisations often don’t understand the risks or the fact that there are cost-effective solutions available,” he said.

He added that protecting against cyber risks requires a holistic approach that integrates people, technology, and processes—beyond firewalls and software alone.

At the forum, Chief Information Security Officer at DLM Capital, Mr. Frank Egwakhide, described AI as both an opportunity and a threat. “AI is like a two-edged sword. Hackers are already using it, so organisations must also use AI for detection and prevention,” he said.

“You cannot have a hacker coming with an AI tool while you are still relying on manual detection. It has to be AI versus AI,” he added.

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Similarly, Mr. Ayodeji Faleto, Head of Compliance at Crystal Finance, noted that AI is enabling cybercriminals to deploy more complex attacks, urging companies to adopt ethical AI tools to defend their systems. He also emphasised that regulatory compliance must go deeper than ticking boxes.

“Regulators are trying their best, but corporate organisations must ensure that compliance goes beyond surface-level rules. The real question is