The KNBS REPORT HIGHLIGHTS 7 WAYS KENYANS LOST MONEY IN 2024.

December 13, 2024 9

A photo highlighting the vibrant Kenyan currency, the heartbeat of the Nation’s Economy.

In 2024, Kenyans experienced a significant rise in financial fraud, with the country seeing an increase in losses through Savings and Credit Cooperative Organizations (SACCOs), according to a report by the Kenya National Bureau of Statistics (KNBS).

The report, published by Finaccess, revealed that internal fraud within SACCOs accounted for the largest portion of the losses, with 71% of victims reporting they were defrauded by employees or insiders within the organizations.

The report also highlighted that mobile money fraud was widespread, with 70% of mobile money users falling victim to accidental transfers. Many Kenyans reported losing money after mistakenly sending funds to either known or unknown recipients.

In addition, the report indicated that 19% of mobile money users had lost money due to internal fraud by service providers, while 15% experienced losses due to transaction reversals.

Speaking about the troubling trend, an official from the KNBS noted, “The surge in financial fraud, particularly within SACCOs and mobile money services, is a major concern for the country. Efforts must be intensified to secure digital and financial platforms to protect consumers from such losses.”

Kenyans have faced mounting financial losses in 2024, with internal fraud within pension schemes emerging as one of the leading causes. According to a new report by the Kenya National Bureau of Statistics (KNBS), 66% of individuals relying on pension schemes were victims of fraud this year.

Pension schemes, which are long-term savings plans allowing workers to save regularly during their careers in anticipation of a refund upon retirement, have been targeted by fraudsters.

The report also highlighted that 56% of Kenyans surveyed reported losing money due to internal fraud within banks, including fraudulent activities by agents and unauthorized reversals. Meanwhile, 46% of respondents stated they lost funds through Microfinance Institutions (MFIs), with internal fraud at these institutions cited as the primary reason.

A photo of Kenyans making a queue in a bank.

Mobile banking users have not been spared either, with 37% of respondents reporting losses due to internal fraud in mobile banking systems.

Speaking on the concerning rise in financial fraud, a KNBS spokesperson stated, “The increasing prevalence of internal fraud in various financial institutions is alarming. The situation requires urgent attention to ensure stronger protections for consumers.”

This surge in financial fraud follows a recent report by Interpol, which uncovered a series of cybercrimes that led to the loss of approximately Ksh 1.1 billion this year. The investigation, conducted between September 2 and October 24, revealed how hackers exploited vulnerabilities in banking systems, using fraudulent scripts to steal funds. The stolen money was then funneled through companies in the United Arab Emirates (UAE), Nigeria, and China, as well as digital asset institutions engaged in trading and financial services.

By Magdaline Wangechi