Nigerian banks now have 16 working days to refund fraud victims

The Central Financial institution of Nigeria (CBN) is rolling out a brand new framework to sort out rising fraud within the banking sector: prospects should now report fraudulent transactions inside 72 hours, whereas monetary establishments, together with banks and fintechs, are certain by a 16-working-day cycle to analyze and situation refunds.

The brand new guidelines come as fraud in Nigeria’s monetary sector continues to surge. Information from the Monetary Establishments Coaching Centre (FITC) reveals fraud losses jumped 603% to ₦3.29 billion ($2.27 million) in Q1 2025, with 12,347 circumstances reported, a 7.63% improve from the earlier 12 months.

The CBN launched draft tips dated November 26, 2025, for dealing with Authorised Push Fee (APP) fraud, aimed to strengthen preventive measures, tighten financial institution accountability, and guarantee sooner reimbursements for victims.

“When finalised, the Tips would mandate all monetary establishments to institute preventive measures in addition to modalities for mitigating and managing APP fraud,” a round signed by Rita Sike, director, Monetary Coverage and Regulation Division, learn.

This marks the continuation of the CBN’s over a decade-long battle in opposition to fraud. In 2011, it established the Nigeria Digital Fraud Discussion board (NeFF) to encourage the trade and the sharing of data on fraud points amongst operators.  In 2015, it mandated that monetary establishments open devoted fraud desks to offer help to prospects on digital fraud. In 2023, it mandated stricter Know Your Buyer (KYC) measures, requiring prospects to offer their Financial institution Verification Quantity or a nationwide identification quantity (NIN) for account or pockets opening. 

In 2024, the apex financial institution instructed the Nigeria Inter-Financial institution Settlement System (NIBSS) to debit the accounts of economic banks that obtain fraud proceeds. 

What’s APP fraud?

The CBN defines it as tricking or deceptive a buyer into authorising a fee, through WhatsApp, SMS, e-mail, or different channels, to a third-party account or pockets.

“Facilitation, negligence, or non-compliance by monetary establishments, comparable to failure to behave on purple flags, weak Know Your Buyer (KYC) or fraud controls, workers collusion, delayed decision, and use of accounts for fraudulent functions,” it mentioned.

Any buyer who’s a sufferer of APP fraud is predicted to report the incident inside 72 hours. Reviews ought to embody transaction date, quantity, recipient particulars, and supporting paperwork.

Banks should now acknowledge the report inside 24 hours and launch an investigation instantly.

Throughout investigations, the CBN could direct NIBSS or any related settlement entity to withhold settlement for the complete worth of any transaction recognized as fraudulent. “This will prolong to second-level or different subsequent beneficiary establishments alongside the transaction chain,” the CBN mentioned.

Investigations should conclude inside 14 working days, and unresolved circumstances could be escalated to the CBN’s Shopper Safety and Monetary Inclusion Division. Reimbursements are to be made inside 48 hours of investigation conclusion.

When an APP fraud incident includes multiple monetary establishment, the originating monetary establishment should begin an investigation and notify the opposite establishment(s) concerned inside half-hour. Affected establishments are anticipated to make reimbursement inside 16 working days from the date the incident was first reported.

If a monetary establishment fails to flag or freeze a fraudulent transaction resulting from insufficient programs, it bears the associated fee. The place no monetary establishment is at fault, and the client can also be not at fault, banks should share the refund equally.

Who will get refunds, and who doesn’t

Clients are eligible for reimbursement once they report fraud inside 72 hours and cooperate with investigations; present no negligence, collusion, or prison intent; had been misled below false pretences; or had been protected by weak or absent financial institution controls.

Clients aren’t eligible for refunds in the event that they acted fraudulently or negligently; failed or report the fraud after 72 hours; and if the transactions predate the rule of thumb’s efficient date.

Exceptions to the 72-hour rule apply if delays had been resulting from sickness, power majeure, or unavailability of reporting channels, or if fraud resulted from financial institution workers negligence or inside management failures.

Failure to conclude investigations inside the set timeframe with out justification will now appeal to regulatory sanctions. Clients may also take points up with the CBN if they don’t seem to be happy with the end result of any investigation.

Nevertheless, offering false, deceptive, or incomplete info to the CBN will appeal to sanctions on the person and the financial institution.

To make sure the profitable implementation of this new rule, monetary establishments should have 24/7 fraud reporting channels, Early Warning Programs (EWS) to detect and mitigate APP fraud, red-flag suspicious accounts, monitor behaviour, and doc fraud indicators, usually report APP fraud incidents to the CBN, and implement monetary literacy outreach for patrons.

The draft guideline is at present open to feedback from monetary establishments and the general public for 3 weeks. As soon as finalised, it would type a crucial a part of the CBN’s ongoing effort to strengthen Nigeria’s monetary ecosystem.