KCB Bank has recently introduced terms and conditions that can only prove that it is throwing in the towel in the war to fight banking fraud. The largest bank by assets in East Africa, KCB Bank has shocked customers who for one reason or the other were withdrawing money from branches where their accounts are not domiciled.
The shock in this is that previously, KCB Bank has used the fact that customers can always be served from any branch countrywide as a unique selling point to attract SME clients. Hence, clients were not careful to worry about home branches. Only to wake up to the shock that one cannot withdraw more than Ksh 100,000 from a branch where their account is not domiciled. The bank introduced this as a measure to curb over the counter cash withdrawal fraud which has seen the bank lose money to fraudsters, who work in cahoots with certain employees to duplicate identity documents and account details that would be necessary to successfully withdraw money from targeted accounts.
The most targeted accounts are the dormant ones whose holders do not transact regularly but have big deposits.
Customers majority businesspersons who travel a lot remonstrated against this since most of the times they are forced by business needs to do transactions from branches not their own. Those who inquired were told the term will remain till further notice.
Banks have in the past lost a lot of money to unscrupulous fraudsters, majority former bankers who collude with employees in service to track customer transaction behavior and steal their identities. Whereas banks like Equity had introduced fingerprint technology to curb OVC fraud, KCB bank is yet to adopt this, though a tender advert on the dailies indicated procurement efforts are ongoing to install the technology.
Reports indicate that Kenyan banks lose up to Ksh 500,000,000 every month due to employee dishonesty. Whereas the new trends in banking fraud have seen a rise in cyber related thefts, mostly targeting internet banking users and mobile banking systems, some challenge still exist in OVC transactions, if KCB Bank losses is anything to go by.
Early this year, the regulator CBK introduced guidelines to help banks curb cybercrime and prepare for other emerging threats to the banking industry, which are reported to be in implementation stage.