This archive report was first published on 6 November 2019.
Published on November 6, 2019, a report by Financial Sector Deepening (FSD) Kenya has shed light on the alarming rate of fraud in Kenyan banks. The report, titled 'Inclusive Finance?', draws its observations from the Finaccess 2019 Household Survey jointly authored by the Central Bank of Kenya (CBK), the Kenya National Bureau of Statistics (KNBS), and FSD.
According to the report, 220,000 bank account holders in Kenya have reported losing their money from their accounts this year, accounting for 3% of bank users in the country. However, 75% of them were able to recover their money after engaging their banks.
"The fact that three quarters were able to recover their funds suggests that loss of money within the banking system is not just a self-reporting accuracy, but a well recognised issue for the banks concerned," the FSD report states.
These findings raise concerns about the safety of depositors' money with lenders, especially in light of the recent Office of the Director of Public Prosecutions (ODPP) implicating a large number of Kenyan banks in the National Youth Service (NYS) heist in February this year.
CBK has since published new regulations requiring banks to report fraud within two hours, aimed at protecting the economy from cyberattacks that have become more prevalent in the last five years.
On October 1, the Directorate of Criminal Investigations (DCI) arrested three suspects believed to have stolen Ksh970,000 from Faith Wanjiku, a 73-year-old woman, using the Equity Bank's Eazzy Pay app.
