Nigeria’s Central Bank Launches AI-Driven System to Detect Financial Fraud in Real Time
These tools are intended to reduce the high rate of false fraud alerts common in older rule-based systems, while still accurately detecting complex scams such as phishing and authorized push payment fraud.
The Central Bank of Nigeria has announced a major policy shift aimed at strengthening the country’s digital financial security through the use of Artificial Intelligence (AI) and Machine Learning (ML). The initiative is designed to improve the detection of fraudulent transactions and enhance oversight of Nigeria’s rapidly growing electronic payments ecosystem. It forms part of the broader reform agenda under the Nigeria Payments System Vision 2028, which outlines how the country intends to modernize its payment infrastructure and align with global standards.
A key feature of the plan is the transition from traditional, reactive fraud monitoring systems to real-time, predictive surveillance. Instead of reviewing transactions after they have been completed, the new AI-driven system will analyze payment data as it happens, allowing suspicious activity to be flagged or stopped before funds are fully transferred. To support this, the CBN plans to establish a dedicated National RegTech and SupTech Lab that will host automated compliance tools and live risk-monitoring dashboards.
The upgraded system is expected to rely heavily on behavioral analytics, including spending patterns, device information, geolocation data, and transaction history. These tools are intended to reduce the high rate of false fraud alerts common in older rule-based systems, while still accurately detecting complex scams such as phishing and authorized push payment fraud. The goal is to improve both security and user experience by minimizing unnecessary disruptions to legitimate transactions.
As part of the implementation roadmap, the CBN has set a target of reducing financial fraud losses by up to 70% by 2028. It also plans to require all regulated financial institutions, including banks and fintech companies, to adopt AI-based compliance and real-time reporting systems within three years. The success of the initiative will depend on cooperation between financial institutions, payment service providers, and security agencies, with the broader aim of building stronger trust in Nigeria’s digital financial system.
