Fraud is the liability of the financial services provider

There is an urgent need for comprehensive legal and regulatory frameworks to hold financial service providers accountable for protecting their customers from cybercrime.

In the digital age, mobile money, banking, and other financial services have become the backbone of Zimbabwe's economy, enabling seamless transactions, financial inclusion, and economic empowerment.

However, this increased reliance on technology has also exposed Zimbabwean consumers to a growing threat - cybercrime. Cybercriminals have brazenly targeted mobile money service providers, banks, and other financial institutions, compromising the sensitive data and funds of unsuspecting citizens.

Despite the dire consequences of these cyber-attacks, many financial service providers in Zimbabwe have failed to prioritise and invest in robust cybersecurity measures. This negligence has left Zimbabwean consumers vulnerable to an array of cybercrimes, including data breaches, identity theft, mobile money scams, and fraudulent transactions. The resulting financial losses, compromised personal information, and erosion of public trust in the financial system have had a devastating impact on the lives of many Zimbabweans.

There is an urgent need for comprehensive legal and regulatory frameworks to hold financial service providers accountable for protecting their customers from cybercrime.

We need to explore the current state of cybersecurity in Zimbabwe's financial sector, the devastating impact of cyber-attacks on consumers, and the critical steps required to safeguard the country's financial landscape.

Zimbabwe's financial sector has undergone a remarkable digital transformation in recent years, with the rise of mobile money services, online banking, and digital payment platforms. While these technological advancements have brought about greater financial inclusion and convenience, they have also exposed the sector to a proliferation of cyber threats.

According to a Zimbabwe Information and Communication Technologies report, Zimbabwe witnessed a staggering 388% increase in cybercrime cases between 2019 and 2020, with the financial sector being one of the most targeted industries. Hackers have exploited vulnerabilities in the systems and infrastructure of mobile money service providers, banks, and other financial institutions, leading to a surge in data breaches, fraud, and financial losses.

The ransom attacks of 2018 to 2022, These attacks highlighted the urgent need for financial service providers to strengthen their cyber-security defences and implement robust security protocols to protect their customers.

The underlying issues contributing to the cyber-security challenges in Zimbabwe's financial sector are multifaceted. Firstly, the lack of comprehensive cyber-security regulations and enforcement mechanisms has allowed financial service providers to operate with minimal accountability for safeguarding consumer data and funds. Without clear legal obligations and deterring penalties, many organisations have been slow to invest in the necessary cybersecurity infrastructure and staff training.

Secondly, the limited cybersecurity skills and awareness among both financial service providers and consumers have exacerbated the vulnerability to cyber threats.

Zimbabwean financial institutions often struggle to attract and retain qualified cybersecurity professionals, hampering their ability to detect, respond, and mitigate cyber incidents effectively. Furthermore, many Zimbabwean consumers remain unaware of the common tactics used by cybercriminals, making them easy targets for scams and fraud.

The consequences of the cybersecurity lapses in Zimbabwe's financial sector have been devastating for consumers. Victims of cyber-attacks have faced a range of personal and financial challenges, from the theft of their hard-earned savings to the compromise of their sensitive personal information.

One of the most common and damaging forms of cybercrime targeting Zimbabwean consumers is mobile money fraud. Cybercriminals have devised sophisticated schemes to trick unsuspecting mobile money users into sharing their login credentials or authorising fraudulent transactions.

This has resulted in the loss of millions of dollars, leaving many Zimbabweans struggling to recover their stolen funds and regain financial stability.

In addition to the direct financial losses, victims of cybercrime often face long-lasting emotional and psychological trauma. The breach of their personal information can lead to feelings of violation, anxiety, and a loss of trust in the financial system. This can have far-reaching implications, discouraging Zimbabweans from fully embracing digital financial services and undermining the country's broader efforts to promote financial inclusion and economic development.

The impact of cybercrime extends beyond individual consumers, also affecting the wider Zimbabwean society. The erosion of public trust in the financial sector can lead to a decline in the use of digital payment methods, hampering the country's efforts to transition towards a cashless economy. This, in turn, can slow down economic progress, limit financial inclusion, and hinder the development of innovative financial technologies.

Moreover, the financial and reputational damage inflicted on financial service providers by cyber attacks can have cascading effects on the broader economy. Significant cyber incidents can undermine the stability of the financial system, leading to reduced investment, decreased access to credit, and a dampening of economic growth.

To effectively safeguard Zimbabwean consumers from the growing threat of cybercrime, it is imperative that the country develops and implements a robust legal and regulatory framework for the financial services industry. The country needs to develop a robust and comprehensive framework, At the heart of this framework should be a set of cybersecurity regulations that mandate minimum security standards and incident response protocols for mobile money service providers, banks, and other financial institutions. These regulations should outline clear requirements for data protection, access controls, network security, and the reporting of cyber incidents.

By establishing these regulations, the Zimbabwean government can hold financial service providers accountable for the security of their systems and the protection of consumer data and funds. Failure to comply with the regulations should result in severe penalties, including substantial fines and the potential for criminal prosecution of responsible parties.

Effective enforcement and oversight mechanisms are crucial to ensuring the successful implementation of cybersecurity regulations. This can be achieved through the establishment of a dedicated cybersecurity regulatory body or the empowerment of existing financial regulators, such as the Reserve Bank of Zimbabwe, to oversee and enforce the new cybersecurity standards. This regulatory body should have the authority to conduct regular audits, investigate cyber incidents, and impose appropriate sanctions on non-compliant organisations.

Additionally, it should work closely with law enforcement agencies to facilitate the investigation and prosecution of cybercriminals targeting the financial sector.

Alongside the cybersecurity regulations for financial service providers, Zimbabwe should also enact comprehensive consumer protection laws that address the rights and responsibilities of both providers and consumers in the digital financial landscape.

These laws should outline the obligations of financial service providers in safeguarding consumer data and funds, as well as the actions they must take in the event of a cyber incident.

Crucially, the laws should also grant consumers the right to seek compensation and redress when their personal information or financial assets are compromised due to the negligence or security failures of their service providers.

By empowering consumers with these legal protections, Zimbabwe can help restore trust in the financial system and encourage greater participation in digital financial services.

Strengthening the cybersecurity capabilities of both financial service providers and consumers is essential for the long-term resilience of Zimbabwe's financial sector.

Financial institutions should invest in building a robust cybersecurity workforce, providing comprehensive training and upskilling programs for their ICT and security personnel. This will enable them to effectively detect, respond to, and mitigate cyber threats, as well as implement best practices in data protection and incident management.

Simultaneously, public awareness campaigns and financial literacy programs should be developed to educate Zimbabwean consumers on the common tactics used by cybercriminals and the steps they can take to protect themselves. This includes promoting the use of strong passwords, recognising phishing attempts, and reporting suspicious activity to the relevant authorities.

To further strengthen the country's cybersecurity capabilities, the Zimbabwean government should foster collaborative efforts between the financial sector, law enforcement agencies, cybersecurity experts, and international partners. This can involve the establishment of information-sharing platforms, joint threat intelligence initiatives, and the development of coordinated incident response strategies.

By adopting a multi-stakeholder approach, Zimbabwe can leverage the collective expertise and resources to enhance its overall cybersecurity posture and better protect consumers from the evolving threats of the digital age. The rise of mobile money, online banking, and other digital financial services has transformed Zimbabwe's economic landscape, enabling greater financial inclusion and economic empowerment.

However, this increased reliance on technology has also exposed Zimbabwean consumers to a growing threat - cybercrime.

Cybercriminals have ruthlessly targeted mobile money service providers, banks, and other financial institutions, compromising the sensitive data and funds of unsuspecting citizens.

Let us protect our consumers and empower them by proving contra-indications of using financial products and services. They should be empowered with the dos and don’ts when using mobile money, financial services, or any other banking products.

  • Mutisi is the CEO of Hansole Investments (Pvt) Ltd. He is the current chairperson of Zimbabwe Information & Communication Technology, a division of Zimbabwe Institution of Engineers. — +263772 278 161 or  [email protected]


Related Topics