A new analysis by the Central Bank of Nigeria (CBN) finds that fraud detection is the dominant artificial intelligence (AI) use case in Nigeria’s rapidly expanding fintech ecosystem, underscoring how risk management is shaping technology deployment across the industry. The findings are contained in the CBN Fintech Report 2025 — a comprehensive survey‑ and stakeholder‑based assessment of Nigeria’s fintech landscape published under the bank’s Policy Insight Series.
According to the report, approximately 87.5 % of Nigerian fintech firms surveyed now deploy AI tools primarily to detect and prevent fraudulent activities. This figure places fraud detection well ahead of other high‑profile AI applications such as customer service automation and credit risk modelling.
AI Adoption in Nigeria’s Fintech: From Experimentation to Practical Risk Management
The fintech sector in Nigeria has grown rapidly in recent years, with digital financial services—especially payments, lending, and mobile money—reaching millions of users across urban and rural communities. In 2024 alone, real‑time electronic payment transactions processed through fintech platforms and payment service providers in Nigeria were estimated at nearly 11 billion — a number that reflects both widespread adoption and an expanding risk surface.
Within this context, fintech operators have turned to AI not as a futuristic experiment but as a practical tool for operational resilience. The CBN report shows that fraud risks have become so pervasive that AI‑enabled fraud detection systems are now considered foundational infrastructure by many firms in the sector.
“In a market where transaction volumes are high, and risk vectors multiply daily, AI plays a central role in safeguarding customers and financial system integrity,” the report notes, reflecting conversations from stakeholder workshops and ecosystem surveys conducted in 2025.
Beyond Fraud: Other Leading AI Use Cases
While fraud detection leads the pack, the CBN report highlights other significant applications of AI among Nigerian fintechs:
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Customer Service Automation: Roughly 62.5 % of fintech operators surveyed use AI‑powered chatbots and virtual assistants to manage customer support queries, complaints, and basic service tasks. These automated systems help firms maintain fast response times and reduce operating costs as their customer bases scale.
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Credit Scoring and Risk Modelling: Around 37.5 % of fintech companies apply AI techniques to refine credit assessments and risk profiles, especially for borrowers with limited or non‑traditional credit histories. This use of AI is seen as a critical enabler for more inclusive lending products.
The report further notes that a minority of fintechs are deploying AI in other areas such as customer onboarding, Know‑Your‑Customer (KYC) processes, and transaction monitoring, reflecting a broader trend of integrating intelligent systems into core business functions.
Why Fraud Detection Leads Adoption
Industry analysts and fintech leaders say that Nigeria’s context — characterised by high transaction volumes, diverse customer profiles, and persistent security threats — has made fraud a top priority for digital finance firms. Fraud losses can erode customer trust, increase compliance costs, and damage corporate reputations, making advanced detection systems essential rather than optional.
The report emphasises that fraud remains a central challenge for fintechs and the wider financial system. As noted by one industry observer, “AI remains the go‑to solution for identifying suspicious patterns and preventing loss before it materialises.”
Regulatory and Operational Constraints to AI Scaling
Despite the strong uptake of AI for key use cases, fintech operators identified regulatory uncertainty and talent shortages as significant obstacles to deeper adoption. About 37.5 % of surveyed firms cited a lack of technical expertise and unclear policy guidance as barriers to scaling more advanced AI systems.
In response, many fintechs have expressed interest in participating in AI‑focused regulatory sandboxes — controlled environments where innovation can proceed under structured oversight — signalling the industry’s appetite for clearer engagement with regulators.
Policy and Industry Implications
The CBN’s findings highlight that fintech innovation in Nigeria is increasingly shaped by risk-mitigation imperatives as much as by growth ambitions. For policymakers, the report suggests that balancing innovation with consumer protection and systemic stability will be critical in the years ahead.
CBN officials have emphasised the need for proactive yet prudent oversight, noting that while AI can enhance efficiency and inclusion, its adoption must be aligned with robust governance frameworks to protect the integrity of the financial system.
Looking Ahead
As Nigeria’s fintech sector continues to evolve, AI is likely to remain a pillar of operational strategy — with fraud detection at the forefront. The CBN report positions the country’s fintech ecosystem as not only a leader in digital finance innovation within Africa but also as a potential model for how emerging markets can harness AI responsibly to manage risk and expand access to financial services.
Fraud Detection Dominates AI Use in Nigeria’s Fintech
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Bio: An (HND, BA, MBA, MSc) is a tech-savvy digital marketing professional, writing on artificial intelligence, digital tools, and emerging technologies. He holds an HND in Marketing, is a Chartered Marketer, earned an MBA in Marketing Management from LAUTECH, a BA in Marketing Management and Web Technologies from York St John University, and an MSc in Social Business and Marketing Management from the University of Salford, Manchester.
He has professional experience across sales, hospitality, healthcare, digital marketing, and business development, and has worked with Sheraton Hotels, A24 Group, and Kendal Nutricare. A skilled editor and web designer, He focuses on simplifying complex technologies and highlighting AI-driven opportunities for businesses and professionals.