CBN Introduces 72-Hour Fraud Reporting Rule, 16-Day Refund Timeline To Curb Rising Financial Crimes

The Central Bank of Nigeria (CBN) has introduced a new framework to combat the surge in banking fraud, mandating customers to report unauthorised transactions within 72 hours, while banks and fintechs must complete investigations and refunds within a 16-working-day cycle.

The move comes amid alarming fraud spikes across the financial sector. Data from the Financial Institutions Training Centre (FITC) shows fraud losses surged by 603%, reaching ₦3.29 billion in Q1 2025, with 12,347 reported cases — a 7.63% rise from the previous year.

In draft guidelines dated November 26, 2025, the CBN outlined rules for handling Authorised Push Payment (APP) fraud, tightening accountability and ensuring faster victim compensation. The circular, signed by Rita Sike, Director of the Financial Policy and Regulation Department, said the guidelines aim to enforce preventive measures and strengthen fraud management processes across institutions.

The new framework builds on over a decade of CBN interventions, including the creation of the Nigeria Electronic Fraud Forum (NeFF) in 2011; mandatory fraud desks in 2015; stricter KYC requirements in 2023; and the 2024 directive empowering NIBSS to debit banks that receive fraud proceeds.

What Is APP Fraud?

APP fraud occurs when criminals deceive customers into authorising payments via WhatsApp, SMS, email, or other channels. It may also arise from negligence by financial institutions, such as weak KYC controls, failure to flag red flags, staff collusion, or delayed resolutions.

How the New Rules Work

• Victims must report APP fraud within 72 hours, providing transaction details and evidence.
• Banks must acknowledge complaints within 24 hours and launch immediate investigations.
• Investigations must conclude within 14 working days, and refunds must be issued within 48 hours after completion.
• Where multiple banks are involved, the originating institution must notify others within 30 minutes, while all affected institutions must conclude refunds within 16 working days.
• The CBN may direct NIBSS to freeze or withhold settlement of transactions flagged as fraudulent.

Who Is Eligible for Refunds?

Refunds apply to customers who:

• Report within 72 hours
• Are not negligent or complicit
• Were deceived or manipulated
• Suffered losses due to weak bank controls

Refunds will not apply if:

• Customers acted negligently or engaged in fraud
• Reports were made after 72 hours
• Transactions occurred before the guideline takes effect

Exceptions may be made for illness, force majeure, or bank-related negligence.

Financial institutions failing to freeze or flag fraud promptly will bear the cost. Where no party is at fault, banks will share refund responsibilities equally.

CBN warns that false or misleading reports to regulators will attract sanctions for both customers and institutions.

The draft guideline is open for public and industry feedback for three weeks before final adoption.