Digital fraud is spreading across Africa’s financial services industry, with nearly nine in 10 banks and fintech companies reporting an increase in fraudulent activities over the past year, raising concerns about the security of the continent’s rapidly expanding digital finance ecosystem.
About 88 percent of banks and fintech companies surveyed across Africa reported rising digital fraud, significantly above the 66 percent average recorded across all financial institutions, according to the sixth edition of the African Financial Industry Barometer released by Deloitte at the Africa Financial Summit (AFIS) 2026 in Luanda, Angola.
The findings expose the growing security pressures confronting financial institutions as digital transactions, mobile banking and technology-driven financial services become increasingly central to the continent’s financial system.
More concerning, however, is the apparent disconnect between the growing incidence of fraud and how institutions assess their exposure to cyber risks.
Despite the widespread increase in digital fraud, only 47 percent of respondents rated their cyber-risk exposure as high, down from 58 percent in 2025. The decline suggests that perceived exposure to cyber threats is not keeping pace with the increase in reported fraudulent activities, creating a gap that could leave financial institutions less prepared for emerging vulnerabilities.
José Barata, managing partner and banking sector lead at Deloitte, during a firechat, he described the divergence as a concern requiring closer attention, particularly as financial services become increasingly digital.
He noted that cybersecurity remained the leading concern among institutions surveyed, despite the lower proportion rating their actual exposure to cyber risks as high.
The pressure is particularly pronounced among banks and fintechs, where cybersecurity concerns increased sharply over the past year.
About 79 percent of banks identified cybersecurity as a major concern, up 19 percentage points from 2025, while the proportion among fintech companies rose by 29 percentage points to 63 percent.
The increase reflects the growing importance of securing digital financial infrastructure as institutions expand their technology-driven operations and handle larger volumes of electronic transactions.
Across the wider financial industry, 51 percent of respondents identified cybersecurity as a major concern, making it the most prominent risk highlighted in the survey.
Beyond cyber threats, geopolitical uncertainty and talent shortages are adding to the pressures confronting financial institutions.
The survey found that 48 percent of respondents identified geopolitical risks as a major concern, up six percentage points from the previous year, while 41 percent cited shortages of skilled professionals, an increase of 11 percentage points.
Geopolitical concerns were particularly pronounced among financial groups operating across multiple countries, with 63 percent identifying the issue as a major risk, compared with 41 percent in 2025.
Deloitte’s findings suggest that the resilience of African financial institutions is increasingly dependent on their ability to manage technology, cybersecurity and human-capital risks alongside traditional financial considerations such as capital, liquidity and profitability.
AI adoption raises new security demands
The growing incidence of digital fraud is also increasing the urgency for financial institutions to deploy artificial intelligence and other advanced technologies to strengthen fraud detection and improve operational efficiency.
The barometer found that 85 percent of respondents expect artificial intelligence to have a major impact on fraud detection, making it the most widely recognised application among the seven use cases examined.
Process optimisation ranked second, with 84 percent expecting significant impact, followed by predictive analytics and business intelligence at 74 percent.
Banks and insurance companies ranked fraud detection and process optimisation among their leading AI applications, while fintechs and microfinance institutions were unanimous in identifying fraud detection as a major area of impact.
However, the transition from recognising AI’s potential to deploying it effectively remains constrained by practical challenges.
Data quality and cybersecurity and privacy were each identified by 56 percent of respondents as major barriers to AI deployment, while 44 percent cited skills shortages.
This creates another challenge for the industry: financial institutions are increasingly turning to technology to strengthen fraud prevention, but weaknesses in data infrastructure, cybersecurity and technical expertise could limit the effectiveness of those investments.
Barata said the industry had moved beyond debating the potential of artificial intelligence, with the priority now shifting towards implementation and the ability to deploy the technology efficiently and responsibly.
Regulatory pressure intensifies
The rising threat of digital fraud is also reinforcing calls for stronger regulatory safeguards across African financial markets.
More than 90 percent of surveyed institutions identified cybersecurity, digital identity, illicit financial flows and foreign exchange regulation as priority areas requiring regulatory attention.
Cybersecurity and digital identity each attracted 97 percent support, while 92 percent identified the prevention of illicit financial flows as a priority. Foreign exchange regulation was also considered important by 90 percent of respondents.
The urgency around illicit financial flows increased significantly, with the proportion of institutions rating their prevention as critical rising from 31 percent to 56 percent.
The increase was particularly pronounced among banks and local financial institutions, reflecting growing concerns about the movement of illicit funds through increasingly interconnected financial systems.
Deloitte’s findings indicate that financial institutions are not necessarily seeking fewer regulations but more effective rules that strengthen the security and integrity of financial services.
The report also highlights a broader challenge facing the continent’s financial industry: maintaining confidence while managing the risks associated with digital expansion.
Overall confidence among African financial institutions remained stable at eight out of 10, unchanged from 2025. However, confidence was stronger among institutions operating across multiple markets, which recorded a score of 8.53, while capital markets players posted the highest business-line confidence score of 8.57.
Banks recorded a confidence score of 8.00, while fintechs maintained 8.25. Insurance companies, however, recorded a decline to 7.45 from 8.35 in 2025.
Chinwe Michael is a Nigerian business journalist and media professional with over 4 years of experience covering companies, financial markets, banking, fintech, economic policy, financial inclusion, and corporate affairs. She currently leads the Companies & Markets desk at BusinessDay, where she drives coverage of Nigeria’s corporate and capital markets, translates complex financial data into accessible stories, and mentors younger journalists. Prior to that, she was the head of the financial inclusion/fintech desk. With a background in banking and finance and extensive experience in media and communications, Michael has developed expertise in financial journalism, economic analysis, investigative reporting and market intelligence. Her work examines how monetary policy, corporate performance, capital flows, technology, and regulatory decisions affect businesses, investors, and households. She was selected from about 3,000 applicants as one of 20 journalists for Cohort 4 of the MTN Media Innovation Programme, gaining exposure to new approaches to journalism, technology, and media innovation. Her international journalism experience and engagement with professionals across Russia, Dubai, Saudi Arabia, and others in different sectors have further broadened her understanding of global communication and development.
