One in five Nigerians lost money or data to scams as trust crisis deepens, says Microsoft
Nigeria’s digital economy is facing a growing trust crisis as one in every five internet users has lost money or personal data to scams, raising concerns that cybercrime could undermine the country’s ambitions of becoming Africa’s leading digital economy.
Nigeria’s digital economy is facing a growing trust crisis as one in every five internet users has lost money or personal data to scams, raising concerns that cybercrime could undermine the country’s ambitions of becoming Africa’s leading digital economy.
Microsoft said the surge in online fraud is changing how Nigerians interact with banks, fintechs and digital platforms, making trust the most important currency for sustaining growth in the country’s fast-expanding digital ecosystem.
While Nigeria has emerged as Africa’s largest digital transaction market with more than 122 million internet users, continued growth now depends on whether consumers believe their money, identities and personal information are secure, says Kerissa Varma, chief security advisor for Africa at Microsoft.
“The businesses, banks, fintechs, platforms and public institutions that understand this first will not only reduce fraud; they will earn the loyalty of digitally engaged Nigerians who have made it clear that if trust fails, they will take their transactions elsewhere,” Varma said in a commentary.
The warning comes as cyber-enabled fraud continues to evolve from isolated financial crimes into a broader economic challenge capable of slowing digital adoption across sectors.
Data from the Global Anti-Scam Alliance’s State of Scams in Nigeria 2026 paints a troubling picture. About 84 percent of Nigerian adults encountered at least one scam over the past year, while 22 percent suffered financial losses or had their personal information compromised. Despite the widespread attacks, only four percent reported the incidents to authorities.
The findings suggest that cybercrime has become more than a security issue; it is increasingly shaping consumer confidence in Nigeria’s digital economy.
Microsoft noted that security now influences purchasing decisions more than product quality. Citing TransUnion’s H1 2026 Digital Fraud Trends in Africa Report, the company said African consumers now rank protection of personal information as the single most important factor when deciding which businesses to trust online.
For Nigerian banks, fintech firms and e-commerce platforms, cybersecurity is no longer simply a compliance obligation but part of the customer experience.
The warning aligns with concerns already raised by the Central Bank of Nigeria (CBN). According to the apex bank’s Financial Stability Report 2024, reported financial fraud cases rose by 45 percent within a year, with nearly 70 percent of total losses originating through digital channels.
CBN governor Olayemi Cardoso has previously warned that rising digital fraud threatens consumer confidence, financial system integrity and Nigeria’s reputation among international investors.
Microsoft said the nature of cyberattacks is also changing rapidly. Rather than attempting to break into computer systems, criminals increasingly exploit legitimate user identities through stolen passwords, fake verification documents, phishing campaigns and social engineering.
The company’s 2025 Digital Defense Report found that cybercriminals are now logging in rather than breaking in, as artificial intelligence dramatically improves the effectiveness of identity-based attacks.
AI-generated identity documents used to bypass digital verification systems increased by 195 percent globally, while AI-powered phishing campaigns are now roughly three times more effective than conventional attacks.
The rise of deepfake technology is adding another layer of complexity. Microsoft said deepfake-related incidents across Africa increased sevenfold between the second and fourth quarters of 2024, making it easier for criminals to impersonate individuals, manipulate biometric verification systems and deceive both financial institutions and consumers.
Nigeria’s banking ecosystem remains particularly exposed.
According to the Nigeria Inter-Bank Settlement System (NIBSS), social engineering remains the country’s most common fraud technique, followed by SIM swap fraud, phishing attacks and account compromise.
Cybersecurity firm Surfshark also reported that more than 150,000 Nigerian online accounts were compromised during the first half of 2025 alone, providing criminals with legitimate credentials that can be used to bypass traditional security controls.
Microsoft warned that identity theft, business email compromise and phishing attacks are increasingly converging into sophisticated fraud operations.
The trend reflects broader developments across Africa. INTERPOL’s 2025 Africa Cyberthreat Assessment identified business email compromise as the continent’s most financially damaging cybercrime, while noting that 90 percent of African countries still require major improvements in cybercrime investigation and prosecution capabilities.
Despite the rising threats, Microsoft acknowledged that Nigeria is making measurable progress in reducing digital payment fraud.
According to NIBSS, fraud losses linked to digital payments fell to N25.85 billion in 2025, representing a 51 percent decline from the previous year. Total fraud incidents also dropped significantly, falling from 123,918 cases in 2021 to 67,518 in 2025.
Industry collaboration among banks, fintech companies and regulators helped prevent approximately N20 billion in potential losses during the year, demonstrating that coordinated security efforts can produce tangible results.
The expansion of Bank Verification Number (BVN) enrolment and wider adoption of two-factor authentication have also strengthened Nigeria’s digital security architecture, with studies indicating that fraud cases declined by between 10 percent and 15 percent following broader implementation of layered authentication measures.
However, Microsoft cautioned that these gains could easily be reversed if organisations fail to treat trust as a strategic business priority rather than an IT responsibility.
The company called on business leaders and government agencies to invest more aggressively in adaptive fraud detection systems, phishing-resistant authentication, stronger digital identity verification and cross-sector intelligence sharing.
It also warned against declining fraud reporting, noting that NIBSS recorded a 34 percent drop in reported fraud incidents during the final quarter of 2025, reducing the visibility needed to identify emerging threats and coordinate responses.
For Microsoft, Nigeria’s next phase of digital transformation will depend less on expanding internet access and more on strengthening public confidence in the digital services that increasingly power banking, commerce, healthcare and government.
As digital transactions become the backbone of Africa’s largest economy, the company argues that trust (not infrastructure alone) will determine whether Nigeria’s digital revolution reaches its full potential.
