Safaricom has partnered with six banks in the pursuit of a solution to reduce the rampant cases of SIM swap fraud that have seen customers lose thousands of shillings.
The SIM-Swap-Check solution provides banks with a free monthly quota of checks and a premium tier for additional checks above the free quota.
The solution gives the lenders an Application Programming Interface (API) through which they can query when a customer’s SIM card was last swapped.
The information, says Safaricom, then enables the banks to make a decision on the likelihood of a customer’s transaction being fraudulent and on additional steps to take.
Thee telco says the solution was developed following an analysis of fraud reports, to tackle the social engineering of customers to conduct fraudulent SIM swaps.
“The rapid growth of Kenya’s fintech sector has been accompanied by a rapidly evolving threat environment targeting both customers and fintech operators. It is therefore necessary for different players to partner around innovations that protect customers and their funds to safeguard the gains made,” said Safaricom chief executive Peter Ndegwa.
“At Safaricom, we have developed SIM-Swap-Check and ATM Vicinity Check solutions that we have made available to banks to empower them to reduce fraudulent transactions,” Mr ndegwa said.
Safaricom explained that the ATM vicinity check solution, also provided to the lenders at no cost, ensures an ATM withdrawal can only be conducted if the transacting customer is in the same location as the ATM.
The move is on the backdrop of a growing number of mobile phone users being targeted by scammers, with the criminals gaining access to their victims’ phones or accounts.
Last October, businessman Abdi Zeila sued Safaricom and the Communications Authority of Kenya (CA) for alleged fraud, and invited other victims to press for the telco to be cited for negligence and be liable for lost cash.
In the class action suit, the businessman wanted the CA found negligent of its regulatory duties by allegedly failing to ensure Safaricom provides services that are secured from fraudsters.
SIM swap scams occur when a criminal is able to convince a mobile operator to issue them with a replacement SIM card by claiming a false identity and pretending that their mobile phone is either lost or was stolen.
Cyber crooks taking control of a victim’s phone number by essentially deactivating their SIM and switching the allocated number to a SIM belonging to a criminal gang.
The criminals then reset passwords on apps, giving them access to their victims’ contacts, banking details, emails and social media accounts.
