The General Manager for Visa in West Africa, Mr. Ade Ashaye, speaks on how coordinated electronic fraud can be checked through technology, among other issues in this interview withOYETUNJI ABIOYE
Could you give us an overview of your operation in West Africa, particularly in Nigeria?
Nigeria, from people’s perspective, is the hub for Anglophone West Africa. From this office, we look after the relationship primarily with our clients, which are the banks and other stakeholders like regulators, processors and the media in Nigeria, Ghana, Sierra Leone, Liberia and The Gambia. Beyond that, we get support in terms of technology from all over the world. This is really the hub for West Africa.
For how long has Visa been in Nigeria?
I first got involved when I was in the London office in 2003/2004 and we had a partnership with a local company. We had one member of staff at that time in Nigeria and we spent a lot of time primarily working with that local company. I moved to South Africa and took responsibility for West Africa towards the end of 2007.
Towards 2008, we started to get more time in the country and started having direct relationships particularly with the banks. Specifically, we had a Visa representative office here in about 2009 with people permanently working there. 2012 was when we had permanent Visa employees on the ground in Nigeria. For now, we are still within the headcount of 11; there is still a couple of people that will still join to fill up the seats and the empty desks.
And yet, we will continue to invest in Nigeria, and we’ve got a good mix of people, who have the experience in the industry and understand the landscape here. We have also people who have experience in other markets that they can bring to Nigeria.. You’ve got to get a good balance of global and local experiences to really help drive things forward.
The electronic payment card industry in Nigeria is still evolving. How has your experience been?
It is an interesting time because you get the feeling that everybody has an idea of where you want to go; everybody is looking at this environment where ‘cashless’ is the same word or phrase you hear all the time. Everybody has an idea where we want to go. There are challenges, technical challenges and knowledge challenges, but you get challenges everywhere; it’s not unique to Nigeria.
What’s amazing, interesting and heartening in Nigeria is that everybody is pushing in the same direction. Nobody is saying ‘electronic payments are bad’, nobody is saying ‘we don’t want electronic payment, we want to keep cash in our environment.’ Nobody is saying that. Everybody is saying there is a situation we want to get to and this is the direction we want to go. And trying to get there is not going to be easy. So, how do you help everybody to get there? That’s the challenge. Some of those other challenges are nice to have, it’s like we are on top of that now. Right now, we’ve got a huge squad. If only you had 11 good players, you would not have the challenge of choice. In Nigeria, there are many options to help to try and get there, how do you get there and how do you try to help to get there?
How will you assess the Central Bank of Nigeria’s electronic payment and cashless policy?
Similar to what I’ve just said. There is a direction everybody wants to go. There is real learning that we continue to bring from other markets, and experiences and things that have worked and things that haven’t worked, and we will continue to provide our knowledge to try and push that forward.
I think there’s more that can happen; there are much more challenges that are often talked about. They often talk about technological challenges. If you looked at three or four years ago, your card didn’t always work. Now if you use your card, it is a very different picture from what it was years ago. There has been some progress made with various stakeholders really trying to push it forward. I think there is certainly much more that we can do. There are steps we can take further. I was talking to one of my friends and he mentioned that now they never go about with more than N5,000 in the wallet. Whereas in the past (which is not many years ago), they had thick wads of cash in their wallets. The situation is so now because in few places they shop, their cards work and, if not, all of the ATMs tend to work. That is the situation. You could not say that four or five years ago. So, definitely, there has been progress and definitely there is further to go. And definitely, we will hit up with them.
Now, coming with the cashless policy is electronic fraud. At the moment, analysts and stakeholders are saying e-fraud is on the rise and even alarming. What do you think can be done to actually mitigate this?
I think if you don’t have your eyes on fraud, you are not running the right business. You have to have your eyes on what is happening. Again, that’s not unique to Nigeria. We work in about 200 countries around the world and it’s the same sort of story that ‘there is fraud and it’s a worry, and how do we manage it?’
What we’ve actually found out is that globally, the fraud rate is historically low. I have not got the numbers for Nigeria for a few months. But the last time I looked at it, I found that fraud on Nigerian-issued Visa cards was significantly lower than the average fraud rate on cards issued outside of Nigeria. And why is that? Because in Nigeria, as an industry, there are things that have been done which other markets are still catching up on.
So the fact that our cards in Nigeria are all what people called chip-and-pin cards. You get to America that’s not the case there; they are just beginning to go through that. The fact that if you want to use your card in an Internet environment, you have to use some additional security solutions Visa has provided; not everybody is doing that. So, those things have come to help to actually ensure that fraud on Nigerian-issued cards is significantly lower than the global average. Beyond that, what is Visa doing? Because we’ve seen more of global transaction than any other network, we have the abilities to provide information to our issuers that can identify potential fraud and track those fraudulent trends and acts at the point of transaction.
We have a system which will give a rating in the individual transaction as the individual is trying to use their card such that the banks can make an educated decision as to whether that transaction is a fraudulent one or not. And it is because what happens is fraud travels; it’s not one person. Sometimes it could be that someone stole his neighbour’s card; that happens but it is not a big threat. The big threat is when you get organised crime syndicates that take a lot of cards and create fake cards and carry out co-ordinated attacks. You can see those kinds of things if you can see the information. And for Visa, when we see this information, we are able to provide data capabilities to the banks; which means they can stop that transaction before it goes through. These kind of investments have made us to keep our eyes on the fraud and make sure we can manage these things.
There are reports that some Nigerian cards are being cloned in the United States and are being used to buy items in US shopping malls. How do we tackle this kind of challenge?
Again, you can use technology to help it. And VisaNet, our processing system, is one of the solutions. Let me give you a specific example of how that can work. If you have your card from a particular bank and you use your card on the Automated Teller Machine and two minutes later, somebody uses the same card with the same number in a shopping mall in the United States, you know there are questions to be asked but if you don’t have the system that will immediately flag you to raise question, then how do you know that one of these is a potential fraud? So the more transactions going through the Visa system, the more we are able to help the banks to identify potentially fraudulent transactions.
What we have found with fraud (in my experience) is that a card is not fraudulent in one transaction. If a card is cloned, it is used may be up to five times until somebody raises the alarm. But the earlier you can identify that there is a problem, the better. You can quickly stop it.
These are the kinds of investments in technology that Visa makes available to our banks and that help really lock down and make sure that we are able to quickly identify frauds and prevent it.