Mobile Money refers to payment services operated via mobile phones, without needing a bank account. It enables cash to be converted into electronic value (and vice versa) in real time, at retail shops or agents. It has transformed access to financial services around the world and driven financial inclusion, especially in developing countries.

Mobile Money: a vast and fast-growing market crippled by fraud

Mobile Money is a vast and fast-growing market that generates significant revenues for Mobile Network Operators. According to the GSMA, the global mobile money market reached $1 trillion in 2021 in transaction value, growing 14-fold from 68 billion in 2012, and is dominated by Sub-Saharan Africa (70%), followed by Asia (29%).

However, fraud is a growing threat that costs money, reputation and loyalty. According to Africa Tech: ‘Africa’s mobile fraud losses will continue to rise above last year’s USD 4 billion to peak at a record USD 5 billion by the end of 2021 if nothing is done to prevent global cybercriminals from looting the continent’s wealth.’

A Tier 1 African Operator is preventing fraud by using Creativity Software’s ready-to-use solution to incorporate real-time device location checks into the validation process of every Mobile Money transaction. This enables remote/online fraudulent transactions to be detected and declined in real time, helping them to deliver a service that customers and agents can trust, that will safeguard their money and prevent revenue losses.

Customer profile: A leading mobile money service provider

Tier 1 African Operator, the largest network operator in their country, with 20 million mobile subscribers in 2021 and leading Mobile Money provider:

  • 9 million active Mobile Money users in 2021
  • 400,000 Mobile Money agents and merchants
  • Mobile Money revenue represents 20% of their service revenue
  • Mobile Money revenue grew by 35% in 2021

Operator’s challenge: remote/online fraud

This Tier 1 African Operator’s goal is to drive financial inclusion across the country by providing an effective and secure Mobile Money service that users and agents can trust. However, fraud is a significant issue that hinders their mission and is costly for all parties involved – operator, agents/merchants and end customers. It can have a devastating effect on people’s lives, especially when the most disadvantaged are impacted. The occurrence of fraud also damages the reputation of the service, affecting trust and subsequent loyalty from both users and agents.

This operator is committed to combatting Mobile Money fraud and securing transactions in order to deliver on its mission.

Considering that a large proportion of fraud is carried out by virtual criminals who are not located in the same area, city or even country of the transaction, the operator required a powerful and reliable location validation solution that would enable them to automatically detect and prevent such fraudulent transactions from going forward.

Solution and benefits: CS Anti-fraud location validation platform

As a recognised leader in mobile location intelligence, this Tier 1 African Operator has chosen Creativity Software to provide a location validation solution that will help combat Mobile Money fraud effectively.

The CS solution helps secure Mobile Money transactions by verifying, in real time, the location of each party involved in the transaction prior to validation. It incorporates device location intelligence into the real-time verification process of the transactions, ensuring that each party is in proximity to each other – as they should be – when the transaction is occurring. Transactions that appear outside a valid location range are declined in real time, which prevents remote/online fraud.

The CS anti-fraud platform is a ready-to-use location validation solution that is designed for fast deployment and regulatory compliance. It provides the real-time location checks required to detect and stop fraudulent transactions, in particular from remote/online fraudsters. It is being deployed in collaboration with a key local partner, ensuring faster time to market and swift on-the-ground support. The solution:

  • Supports real-time service delivery: device location checks are carried out in real time as part of the validation process of all Mobile Money transactions, ensuring a seamless service delivery, with no interruption or delay.
  • Ensures full population coverage: the solution is independent of the type of device used. Therefore, it works for any mobile device, from the oldest phones to the newest smartphones, allowing any mobile money user to be protected and any fraudster detected.
  • Incorporates reporting and visualisation: the solution incorporates a full map-based visualisation and analytics tool to facilitate tracking, reporting and investigations.
  • Supports heterogeneous network environments from 2G to 5G: the solution works for all the operator’s mobile network generations (2/3/4G) across the entire country, and can seamlessly be extended to 5G when they are ready.
  • Is standards-based and easy to integrate: the CS anti-fraud solution easily integrates with any Mobile Money platform using open standard or customised interfaces (e.g. OMA MLP, web services etc.).
  • Always works and is reliable: the solution is based on location data from the mobile network, which continually captures the subscribers’ locations and is the most reliable source for this. It allows the location information to be obtained without having to rely on the user or their device-based location technology (GPS) and cannot be disabled by fraudsters.

With this anti-fraud location validation solution, Creativity Software is helping this Tier 1 African Operator to deliver on its mission to drive financial inclusion, protect people’s money, secure trust from users and agents, and maximise its Mobile Money revenues.

Key use cases: CS Location validation solution against fraud

The CS Location validation solution enables multiple Mobile Money anti-fraud use cases, including:

  • Stopping transactions from remote/online fraudsters: if the Mobile Money subscriber is not near the agent or merchant as they should be, the transaction will be declined in real time.
    Detecting suspicious SIM swaps: the solution validates SIM card and device association. When there is a swap, this will trigger an alert and further analysis before the transaction could possibly be validated.
  • Geofencing and monitoring high-risk fraud areas: areas that have been identified as high risk can be geofenced and any transaction taking place there will be automatically flagged for further analysis before possible validation.
  • Ensuring that agents operate within designated areas: when agents are allocated specific operating areas or timeframe (e.g. 8am–10pm), the solution can track this to ensure that all transactions happen within the defined framework, otherwise they are flagged/rejected.
  • Preventing fraudulent Mobile Money withdrawals from ATMs: when ATM withdrawals can be made using Mobile Money services, the solution can verify that the subscriber is within a valid range of the ATM being used, otherwise the transaction will be rejected.
  • Supporting dispute resolution and investigations: the CS solution enables fraud departments to ascertain the location of users at the time of a transaction in order to resolve disputes promptly or support police investigations.

The operator can further maximise their investment as the solution which is based on CS LocationWise can also be leveraged to comply with regulatory obligations for emergency services and law enforcement, and for other commercial services.

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