The deployment and widespread adoption of digital financial products has been of immense value to both end users and the financial institutions developing them. The speed and ease of use offer customers a memorable experience while financial institutions are able to cut costs and remain competitive in the industry.
However, as more innovative solutions are being churned out in the financial services industry, exposure to risks and vulnerability have heightened. Hackers and fraudsters are using all possible means to explore the vulnerabilities in the new products to steal customers’ data and funds. A recent report by the Nigeria Inter-Bank Settlement System Plc (NIBSS) confirmed that as more people are financially included on different payment platforms, more avenues for fraudsters to carry out their fraudulent activities are opening up. The report states that the number of fraud attempts on mobile payment channels as well as Web portals and Point of Sale (PoS) terminals grew by 173 percent and 215 percent each year between 2019 and 2021.
As one of the pioneers in the digital payment ecosystem in Africa, Interswitch, Africa’s leading integrated payments and digital commerce company, remains one step ahead of fraudsters in the development of security solutions offering convenience in the use of its digital products while guaranteeing safe transactions and protection of customers’ data with the introduction of a new layer of protection, tokenization.
Tokens secure credit card data, preventing it from being misused. When making purchases on web portals, customers’ data is stored as tokens that cannot be deciphered. Tokenization has helped many businesses to forge stronger business relationships, gain the trust of customers and simplify the online shopping experience. Due to its ability to prevent the exposure of original information of bank customers, tokenization has become indispensable in the financial industry and found multiple use cases.
Akeem Lawal, the Managing Director of Interswitch Purepay, said that the company has seen the need to provide improved security features to its clients as it continues to innovate and deliver cutting-edge payment solutions.
He said, “Tokenization introduces an improved layer of security over PINs and passwords. With tokenization, the 16-digit account information of every account holder has been replaced with a unique digital identifier known as a token. This token allows online retailers to collect payment more securely while customers can check out faster and easier across apps, mobile, in-store and online platforms.
“The presence of strong and robust security protection is a priority for us at Interswitch as we work with all stakeholders to build sustainable businesses, protect the integrity of the industry, deepen financial inclusion and grow the economy.”
One financial institution, Providus Bank has been proactive in its approach to adopt innovative technologies that provide future forward banking and ensure customer satisfaction. This disposition has led the institution to promptly adopt tokenization as it seeks to improve the quality of its product offerings.
As Nigeria's digital ecosystem expands, there is a need for more creative ways to tackle associated vulnerabilities. It is essential to increasingly allay customers’ fears as financial services gain more recognition and spread among the populace.
Interswitch remains focused on developing and scaling innovation to ensure safe transactions and protect users’ data and funds. The biometric features on PoS terminals and Automated Teller Machines (ATMs) is another security solution recently unveiled by the payment giant to check digital payment fraud.