In a bid to tackle the rising tide of digital fraud in South Africa, operators in the country are set to deploy innovative Application Programme Interfaces (APIs) under the GSMA Open Gateway initiative.
These APIs, focusing on Number Verification and SIM Swap, will be accessible to all mobile commerce and financial institutions, as well as developers, aiming to fortify security measures and safeguard the nation’s 47 million mobile subscribers against cyber threats.
The decision comes on the heels of a disconcerting surge in reported incidents of digital banking fraud, which escalated by 24 percent in 2022, as disclosed in a report by the South African Banking Risk Information Centre (SABRIC). With cyber criminals pilfering over R740 million from unsuspecting victims, the proliferation of fraud cases associated with banking applications and online banking has become a pressing concern.
Mobile Network Operators (MNOs) are rallying behind the standardization of APIs, viewing it as a pivotal step in curbing digital fraud. By leveraging their technological infrastructure, MNOs aim to bolster security measures embedded within banking applications and online banking platforms, enhancing the overall resilience of South Africa’s digital banking ecosystem against cyber threats.
The introduction of these APIs not only ensures stringent privacy protocols but also holds significant implications across various sectors such as banking, finance, insurance, and retail.
The two APIs set to be implemented are:
Number Verification: This API streamlines the verification process of a user’s mobile number, offering enhanced authentication and user experience. By obviating the reliance on SMS, Number Verification automatically verifies a user’s identity, thereby improving user experience and mitigating potential issues arising from SMS delivery failures or technological unfamiliarity.
SIM Swap: Designed to detect recent changes in SIM cards associated with a given phone number, this API serves as a deterrent against account takeover attacks orchestrated by fraudsters. By scrutinizing the relationship between the customer’s phone number and SIM card during financial transactions, institutions can make informed decisions regarding transaction approval, thus minimizing the risk of fraudulent activities.
The initiative is poised to empower developers not only within South Africa but also globally, facilitating the accelerated growth of digital services and applications.
The GSMA Open Gateway initiative, launched at MWC Barcelona 2023, represents a groundbreaking approach to mobile application development, fostering interoperability among operators, industry stakeholders, and developers worldwide.
With 42 mobile operator groups from various corners of the globe already on board, the initiative signifies a concerted effort to revolutionize the mobile telecommunications landscape while upholding the highest technical standards, regulatory compliance, and user privacy protocols.
Industry stakeholders have welcomed the initiative, recognizing its potential to fortify consumer protection and bolster trust in the digital economy. Angela Wamola, Head of Sub-Saharan Africa at GSMA, emphasized the strategic role of mobile network operators in mitigating banking fraud and protecting consumers, underscoring the importance of collaboration in this endeavor.
Leaders from major operators, including Cell C and MTN Group, have expressed their commitment to creating a collaborative ecosystem aimed at safeguarding consumers against digital fraud, underscoring the collective responsibility shared by stakeholders in ensuring the integrity of South Africa’s digital landscape.
