BoU warns on rising cyber fraud as banks deepen digital shift

The Bank of Uganda has warned of rising cyber crime risks as more Ugandans shift to digital banking platforms, with fraud losses hitting Shs 1.02 trillion in 2024.

The warning was issued during the launch of new digital platforms by NCBA Bank Uganda, where BoU said the rapid growth of online banking is exposing customers and institutions to increasingly sophisticated cyber threats.

Tumubweinee Twinemanzi, the executive director for National Payment Systems at the central bank, said cyber crime is evolving through complex system hacks, insider collusion and cross-border digital fraud schemes that are draining the economy.

“As we increasingly rely on digital platforms to provide financial services, there is one downside that becomes more prominent and begins to erode the benefits, and that is cyber crime,” Twinemanzi said.

He warned that every step financial institutions take towards digitisation increases their exposure to cyber risks, urging banks to invest equally in security systems.

“For every step you take forward in offering digital services, you also increase the risk of cyber incidents. The effort put in developing these products must equally go into mitigating fraud,” he added.

Twinemanzi also noted that banking is rapidly evolving into a technology-driven sector, where the distinction between financial services and digital innovation is becoming less clear.

“Banking today is more like technology with finance, and the line between the two will continue to blur,” he said.

NCBA Now, targeting retail customers, and Connect Plus, designed for corporate and business clients, as part of its digital transformation strategy.

Mark Muyobo, chief executive officer of NCBA Bank Uganda, said the platforms are intended to simplify banking and improve customer experience across segments.

“Banking should be an enabler for customers’ ambitions, whether they are entrepreneurs, professionals or businesses expanding into new markets,” Muyobo said.

He noted that the future of banking will be defined by customer experience rather than the number of physical branches, with demand growing for faster, more convenient and secure services.

“With NCBA Now, customers can access banking at their fingertips, including fund transfers, utility payments, URA and NSSF payments, loan management and real-time transaction alerts,” he said.

Muyobo noted that Connect Plus integrates multiple services such as bank transfers, statutory payments, mobile money and international transactions into a single platform, while offering real-time account visibility and reporting tools for businesses.

Sally Chege, NCBA Group director for transactional banking, said digital banking adoption is rising across the region as institutions simplify services and prioritise customer needs.

“Customers are gaining confidence in digital banking when it is reliable, simple and customer-centred,” she said.

Chege revealed that the platforms are being rolled out across East Africa, with launches already underway in Rwanda and plans to extend to Tanzania.

She said the systems will allow customers to manage cross-border transactions seamlessly, with features such as real-time payments, liquidity management and consolidated account visibility.

“Connect Plus has become more than a banking platform. It is now a tool for managing and scaling businesses across the region,” she said.

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