CBN orders 48-hour refunds for APP fraud victims

The Central Bank of Nigeria has proposed new rules requiring banks and other financial institutions to refund victims of Authorised Push Payment fraud within 48 hours of investigations being concluded.

This is according to the draft “Guidelines for Handling Authorised Push Payment Fraud” issued by the apex bank and dated November 26, 2025, but released on the bank’s website on Tuesday.

The document states that “reimbursement, where applicable, shall be made within forty-eight (48) hours from the conclusion of a documented APP fraud investigation.”

The CBN said the framework is aimed at curbing the rising incidence of fraud carried out through social engineering, impersonation, deception and other techniques that pressure victims into authorising transfers to fraudsters.

It noted that APP fraud had become increasingly difficult to detect because it “exploits the customer’s trust and the finality of digital transactions,” leading to financial losses and weakening public confidence in electronic payments.

Under the proposed rules, banks will be required to complete investigations into reported APP fraud cases within 14 working days and immediately inform customers of the outcome.

Institutions must acknowledge complaints within 24 hours and assign a unique case reference number. Where more than one financial institution is involved in a disputed transaction, the originating institution is expected to commence investigation immediately and notify the others within 30 minutes of receiving the customer’s complaint.

The guidelines also provide clearer conditions under which victims qualify for reimbursement. A customer is eligible if the transaction was authorised under false pretences, reported within 72 hours, and there is no evidence of negligence, collusion, or criminal intent. Banks are required to exercise a higher duty of care when dealing with vulnerable customers.

However, the 72-hour reporting requirement may be waived in exceptional cases such as illness, security constraints, or situations where reporting channels are unavailable.

The draft warns that failure by any institution to meet stipulated timelines “may constitute a breach of consumer protection obligations and attract appropriate regulatory sanctions.” Banks will also be liable when their internal systems fail to detect or freeze suspicious inflows.

Institutions with inadequate fraud-detection mechanisms will be debited for the full loss amount and may face sanctions. The CBN has directed all institutions to strengthen their Early Warning Systems, improve monitoring of red-flag indicators, and maintain dedicated fraud analytics units.

Also, banks are required to provide 24-hour reporting channels via email, mobile apps, USSD, customer service hotlines, and physical branches. They must also conduct quarterly fraud-awareness campaigns and file quarterly returns with the CBN on APP fraud incidents, remedial actions, and financial literacy programmes.

Where institutions involved in a disputed transaction fail to resolve within the stipulated period, the matter will be escalated to the Consumer Protection and Financial Inclusion Department of the CBN for a final decision.

In cases where neither the sending nor receiving bank is at fault but the customer qualifies for reimbursement, the two institutions will share the refund equally. The guidelines were issued by the Director of the Financial Policy and Regulation Department, Dr Rita Sike, who invited banks, financial institutions, and the public to submit comments within three weeks.

Once finalised, the rules are expected to introduce stricter accountability standards in the banking sector and strengthen consumer protection across Nigeria’s digital-payment channels. The PUNCH earlier reported that Banks in Nigeria reported N42.33bn in fraud-related losses over the first two quarters of 2024, with increases recorded across multiple payment channels.

Source: https://punchng.com/cbn-orders-48-hour-refunds-for-app-fraud-victims/