PalmPay says trust deficit, fraud concerns stall digital payments growth

Chika Nwosu, Managing Director of PalmPay, stated that trust deficits and fraud concerns remain the most significant challenges facing Nigeria’s digital payments ecosystem. Speaking on Friday at the Payments Forum Nigeria (PAFON 3.0) in Lagos, Nwosu emphasized that despite improvements in platform technology, many citizens remain skeptical due to fears regarding fund safety and transaction failures. The Managing Director noted that prior to 2019, transaction failure rates frequently exceeded 10 percent, which significantly eroded public confidence in electronic payments. He argued that addressing these concerns requires sustained investment in security systems, innovation, and strict adherence to regulatory compliance. Operators must also follow due process when resolving fraud cases, even when customers demand immediate refunds. Nwosu highlighted that fintech firms are collaborating with regulators, including the Central Bank of Nigeria, and telecom operators to enhance transaction security. He stressed that the future of the sector lies in embedding financial services into everyday platforms used by individuals and businesses. According to him, embedded finance enables seamless transactions by integrating payments into environments where people live, work, and trade. Expanding access through mobile technology and agent networks is seen as key to boosting inclusion, particularly among small businesses and informal operators. Citing World Bank data, Nwosu pointed out that only about 43 percent of adults in sub-Saharan Africa had formal financial access in 2017. He concluded that improving reliability, integration, and accessibility is essential for building trust and increasing the adoption of digital financial services across the region.