Finally, Nigerians can get refunds after bank fraud as CBN sets new rules

Nigerians who lose money through their bank accounts to scammers may soon have a clearer pathway to getting their funds back.

The Central Bank of Nigeria (CBN) has introduced a new draft framework that forces banks and fintechs to respond faster, tighten their controls, and reimburse victims of a fast-growing form of online fraud.

The guideline, released on November 26, targets what the CBN calls Authorised Push Payment (APP) fraud. This is a common type of scam where criminals trick people into authorizing transfers themselves – usually through WhatsApp messages, fake emails, social media chats, or manipulated SMS alerts.

Because the victims willingly approve the transfers, banks often claim they cannot refund the money. The CBN is now moving to change that.

“When finalised, the Guidelines would mandate all financial institutions to institute preventive measures as well as modalities for mitigating and managing APP fraud,” said Rita Sike, Director of the CBN’s Financial Policy and Regulation Department.

Under the new rules, customers who fall victim to such scams must report the incident within 72 hours and submit basic details such as the transaction date, the amount involved, and the beneficiary account or wallet.

Banks must acknowledge the complaint within 24 hours and begin investigations immediately. These investigations must be concluded within 14 working days, and if the customer is found not to be at fault, a refund must be made within 48 hours of the investigation’s conclusion.

Where multiple banks or fintechs are involved in a fraudulent transfer, the CBN requires the institution where the transaction originated to open a case and notify all other parties within 30 minutes. All institutions involved will then have a maximum of 16 working days to complete their investigation and issue any refund due.

Extensive Powers

The regulator is also giving itself stronger powers during investigations. It may direct the Nigeria Inter-Bank Settlement System (NIBSS) or any other settlement entity to withhold funds linked to suspicious transfers. This freeze can extend to any subsequent bank or wallet into which the money is routed.

Responsibility for refunds will depend on the findings. If the loss occurred because a bank failed to detect red flags, ignored fraud alerts, maintained weak Know-Your-Customer (KYC) controls, or delayed action, that bank will bear the cost.

If neither the customer nor any bank is found negligent, the banks involved will share the refund equally. Refunds will not be granted if a customer acted fraudulently, ignored obvious risks, or failed to report within the 72-hour window.

Exceptions to the reporting window are allowed in cases such as illness, force majeure, system outages, or where bank staff negligence contributed to the loss.

Customers can also report unresolved complaints to the CBN’s Consumer Protection and Financial Inclusion Department. But the apex bank warns that anyone who provides false or misleading information will face sanctions, and their bank may also be penalized.

Past Unsuccessful Efforts

The new effort builds on more than a decade of attempts by the CBN to curb electronic fraud. In 2011, it set up the Nigeria Electronic Fraud Forum (NeFF) to coordinate industry responses to emerging threats.

Four years later, banks were directed to open dedicated fraud desks. By 2023, the CBN introduced tighter KYC requirements, insisting on BVN or NIN for all accounts and wallets. And in 2024, the apex bank authorised NIBSS to debit the accounts of commercial banks found to have received fraud proceeds.

Fraud remains a growing problem. Data from the Financial Institutions Training Centre (FITC) shows that losses jumped 603 percent to ₦3.29 billion in the first quarter of 2025 alone, with more than twelve thousand reported cases – a 7.6 percent increase from the previous year.

To comply with the new framework, banks and fintechs must maintain 24-hour fraud-reporting channels, deploy early-warning systems, document suspicious activity, and run customer-education programmes.

The draft guideline is open to public and industry comments for the next three weeks, after which it will become part of the CBN’s broader push to rebuild trust and strengthen the safety of Nigeria’s financial system.