Latest: MTN Wants Banks to Pay for Telecom-Powered Security Checks As SIM-Swap Fraud Rises
SIM-swap fraud remains one of Nigeria’s most persistent financial security challenges despite years of regulatory interventions and security improvements. According to data from the Nigerian Communications Commission (NCC), Nigerians reportedly lost approximately ₦12.5 billion to telecom-related financial crimes between 2019 and 2023. Many of these crimes involved a combination of SIM-swap attacks, identity theft, and social engineering tactics.
Now, MTN Nigeria says it already possesses part of the technological solution needed to combat the growing threat. However, the telecom giant argues that banks and financial institutions must be willing to pay for telecom-powered security intelligence services if they expect mobile operators to build and maintain the additional security layers required.
The debate raises an important question: Who should bear responsibility for protecting consumers from SIM-swap fraud — telecom operators, banks, regulators, or consumers themselves?
Understanding How SIM-Swap Fraud Works
SIM-swap fraud generally occurs in two major ways.
1. Traditional SIM-Swap Attacks
In the traditional form of SIM-swap fraud, criminals attempt to gain control of a victim’s mobile number by fraudulently replacing the SIM card attached to that number.
Typically, the fraudster visits a telecom service center and claims that the original SIM card has been lost, damaged, or stolen. Using personal information obtained through social engineering, data leaks, or public sources such as social media, the criminal successfully convinces the operator to issue a replacement SIM.
Once activated, the fraudster gains access to:
- One-time passwords (OTPs)
- Banking alerts
- Password reset requests
- Multi-factor authentication codes
- Account recovery notifications
This access often allows attackers to compromise bank accounts and digital financial services.
2. Recycled Mobile Number Fraud
A less obvious but increasingly dangerous threat involves recycled mobile numbers.
This typically happens when:
- A customer travels abroad for an extended period,
- Stops using a phone line,
- Or abandons a SIM card altogether.
After prolonged inactivity, telecom operators may deactivate and eventually reassign the number to a new subscriber.
The problem arises when banks, fintechs, and other service providers continue sending sensitive information to the old phone number, including:
- Bank transaction alerts
- Account balances
- OTP codes
- Credit notifications
- Personal account information
Over time, the new owner of the recycled number may unintentionally or deliberately gather enough information to compromise the previous owner’s financial accounts.
SIM-Swap Fraud Scenarios Explained
| Fraud Type | How It Happens | Potential Risk |
|---|---|---|
| Traditional SIM Swap | Criminal fraudulently obtains replacement SIM | Account takeover and financial theft |
| Recycled Number Fraud | Inactive number reassigned to another subscriber | Information leakage and identity compromise |
| Social Engineering | Fraudsters gather information from public sources | Increased success of SIM fraud attacks |
Why Telecom Operators Say Customers Don’t Actually Own Their Numbers
According to MTN Nigeria’s Chief Corporate Services and Sustainability Officer, Tobe Okigbo, many Nigerians incorrectly assume they permanently own their mobile numbers.
Okigbo explains that telecom operators obtain licensed number blocks from regulators and assign those numbers to subscribers under regulated usage conditions.
He noted that subscribers effectively “rent” mobile numbers rather than own them outright.
“On the network, each number has a license attached to it. The numbers must remain unique globally to avoid conflicts across telecommunications networks,” he explained.
Under current regulations:
| Timeline | Action |
|---|---|
| 180 days | Number enters quarantine after inactivity |
| Additional 365 days | Number becomes eligible for recycling |
Previously, telecom operators were allowed to quarantine numbers after 90 days and recycle them after 180 days. However, updated NCC regulations extended these timelines to provide greater consumer protection.
The Role of Truecaller and Public Information Exposure
Okigbo also highlighted how consumers unknowingly contribute to the problem through widespread use of caller identification applications such as Truecaller.
These platforms collect user-generated contact information and display names associated with phone numbers.
As a result:
- A recycled number may continue displaying the former owner’s identity.
- Fraudsters can combine information from Truecaller with social media data.
- Attackers can build detailed profiles that assist in identity theft attempts.
According to MTN, telecom operators often receive blame for information exposure that occurs entirely outside their networks.
MTN: Banks Chose Phone Numbers as Identity Tools
Perhaps MTN’s strongest argument centers around the banking industry’s decision to use phone numbers as primary identity verification tools.
Okigbo argues that telecom operators never formally agreed to make mobile numbers a permanent customer identity system.
He stated:
“If banks decide to use our numbers as identifiers, then banks should compensate telecom operators for providing the additional security infrastructure required.”
According to MTN, if telecom companies are expected to provide real-time fraud prevention services, they should also be financially compensated for the associated operational and technology costs.
What Happens When Customers Leave Their Numbers Inactive?
Many Nigerians remain unaware that abandoning a mobile number for long periods can create serious financial risks.
Customers who travel abroad or stop using a number should:
- Keep the line active periodically.
- Subscribe to long-term validity packages.
- Maintain minimum usage activity.
- Update banks whenever changing phone numbers.
Failure to do so may eventually expose financial accounts to recycled-number fraud.
Industry Experts Suggest Practical Solutions
1. Improve Customer Awareness
Lendsqr CEO Adedeji Olowe believes telecom operators should significantly improve public awareness campaigns.
He recommends:
- Quarterly SMS reminders.
- Public education campaigns.
- Inactivity warning notifications.
- Multiple alerts before number recycling.
Such initiatives would cost relatively little while potentially preventing billions of naira in fraud losses.
2. Allow Email Registration for Mobile Numbers
Olowe also proposes allowing subscribers to register email addresses against their SIM cards through USSD services.
This would allow operators to:
- Notify customers via email.
- Send inactivity warnings.
- Alert customers before recycling occurs.
- Maintain contact even when SIM cards become inactive.
3. Banks Should Use Telecom Intelligence Services
Another proposed solution involves banks leveraging telecom network intelligence systems.
For example, MTN’s API business platform, Chenosis, already offers services that can determine:
- Whether a mobile number remains active.
- Whether a recent SIM swap occurred.
- Whether a number is considered high risk.
Banks could periodically verify customer phone numbers and automatically trigger additional security checks whenever suspicious activity is detected.
Proposed Solutions at a Glance
| Solution | Responsibility | Expected Impact |
|---|---|---|
| Customer education | Telecom operators | Increased awareness |
| Email registration | Telecom operators | Better communication |
| SIM status verification | Banks | Reduced fraud risk |
| Real-time telecom intelligence | Banks and telcos | Improved fraud detection |
| Regulatory coordination | NCC and CBN | Industry-wide protection |
Banks May Support the Idea — But Who Pays?
A senior executive at a Nigerian tier-one bank reportedly views MTN’s proposal as a viable long-term solution to SIM-swap fraud.
However, the major challenge remains funding.
Banks already pay telecom operators substantial amounts annually for services such as:
- SMS alerts,
- Communication infrastructure,
- Verification services,
- Customer notifications.
The banking executive suggested that a more practical approach would involve the:
- Central Bank of Nigeria (CBN),
- Nigerian Inter-Bank Settlement System (NIBSS),
- Nigerian Communications Commission (NCC),
- Telecom operators,
agreeing on an industry-wide framework that would establish standard annual fees for telecom-powered fraud prevention services.
The CBN-NCC Telecom Identity Risk Management Portal
In April 2026, the Central Bank of Nigeria and the NCC signed a Memorandum of Understanding aimed at tackling SIM-related financial fraud.
The agreement led to the creation of the:
Telecom Identity Risk Management Portal (TIRM)
The platform enables:
- Real-time SIM verification,
- Detection of recycled numbers,
- SIM-swap monitoring,
- Blacklisted number identification,
- Fraud intelligence sharing between banks and telecom operators.
CBN Governor Olayemi Cardoso said the initiative would strengthen consumer protection across Nigeria’s financial system.
Similarly, NCC Executive Vice Chairman Aminu Maida stated that the platform provides financial institutions with better tools for combating phone-number-related fraud.
Conclusion
SIM-swap fraud has evolved beyond isolated criminal incidents into a broader infrastructure and identity management challenge.
While MTN argues that telecom operators should not bear sole responsibility for protecting financial institutions, industry stakeholders increasingly agree that collaboration between banks, telecom companies, regulators, and consumers is necessary.
The technologies needed to reduce SIM-related fraud already exist. The real challenge lies in determining who pays for them, who operates them, and how quickly stakeholders can work together to implement them.
If initiatives such as the Telecom Identity Risk Management Portal succeed, Nigeria could finally make meaningful progress in reducing one of its most persistent financial security threats.
