The impact of cybercrime on the Nigerian economy and banking system:
Date
2019
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Abuja: Nigeria Deposit Insurance Corporation
Abstract
Stylized facts on information and communication technology (ICT) performance in Nigeria; Conceptual issues – definition, Types and dimension of cyber-crime; Causes and effects of cyber-crime in Nigeria; The impact of cyber-crime on the economy and Nigerian banking system; Strategies for combating cybercrime in the Nigerian banking system.
Description
The role that Information and Communication Technology (ICT) plays in all aspects of human endeavors is well documented and evident. ICT has integrated different economies of the world, through the aid of electronics via the internet. Many corporate organizations, including banks now depend on ICT and computer networks to perform basic as well as complex tasks. The electronic market is now open to everybody, including criminals. It is projected that by 2020, global Cyber security spending will reach $170bn, a 126% increase from $75bn in 2015. According to the World Economic Forum’s report Globalization 4.0, “More organizations than ever are conducting business online” (Davos 2019). The spate of rising preponderance of digital footprints and sophistication in cyber-attacks has prompted the urgency to intensely secure data and other organizational resources from exposure to activities of cybercriminals. This has been the reason for increasing cost of deploying ICT within institutions due to added costs of enhancing security from cyber-attacks. On this backdrop, Gartner1 predicted that worldwide spending on information security will significantly grow to $124 billion in 2019. And still, spending according to some security researchers estimate that cybercrime costs will quadruple from its figure in 2015 to about $2.1 trillion by end-2019, and outpace expenditure on cyber-security by over 16 times. The vulnerability of this electronic market to criminal activities has therefore been a growing concern. Nigeria’s internet penetration since the 21st century had been on the increase. Internet users as a percentage of the population increased significantly from 3.5% in 2005 to 47.4% in 2014 (WDI, 2016). Similarly, tele-density has been forecasted to continuously increase overtime in Nigeria (Asemota, et al, 2015). The proliferation of internet in Nigeria has indeed come with unintended consequence, as a haven for criminals. Cybercrime has remained a challenging issue despite increasing awareness and attention to addressing the menace in Nigeria and across the globe. For instance, Cybercrime accounted for about 43% of total monetary loss due to fraud in 2016. These losses have negative impacts on individuals, businesses and the government in terms of welfare losses, business disruption, profit reduction/rising operating cost and revenue losses, etc.