Emmanuel Ojukwu
Kenya’s banking sector is increasingly adopting artificial intelligence (AI) as a strategic tool to combat internal fraud and theft, reflecting the growing importance of technology in enhancing financial security.
This technological shift is driven by the need for more sophisticated and efficient methods to safeguard financial institutions against the growing threat of internal fraud cases.
In its annual report review of technology developments in the banking sector, the Central Bank of Kenya (CBK), noted that lenders in the country are now leveraging AI to improve operational efficiencies, predict customer behavior and manage risks more effectively, including through keeping a keen eye on staff communication.
“Banks have deployed Al solutions to monitor electronic communications by staff in the trading room to detect outliers and irregularities” CBK said in a statement
With rising fraud losses and legal challenges from customers alleging complicity by bank staff, major lenders like KCB Group and Absa Bank are implementing AI to monitor employee communications and behaviors to detect irregularities and potential fraud.
This shift marks a significant evolution from previous AI uses, primarily focused on customer service and market predictions. Banks are now leveraging advanced technologies to enhance operational efficiency and risk management and safeguard their operations against internal and external threats.
Also, AI systems enable banks to continuously monitor transactions and internal activities in real time. These systems analyze patterns and detect anomalies, flagging suspicious activities instantly. This allows banks to intervene immediately, preventing fraudulent activities from escalating and mitigating potential losses
The move to incorporate AI reflects a broader trend in Kenya’s financial industry, where the need for robust fraud prevention mechanisms has become paramount in light of escalating fraud attempts, prompting banks to invest heavily in AI-driven solutions to protect their assets and customer trust.
Source: Business Daily
