According to Statista, between 20 million and 22 million South Africans were using smartphones by January this year. As the use of smartphones with near-field communication has increased, so too have related fraudulent incidents.
The banking ombud, Reana Steyn, has sounded an alert after her office recently received about 124 near-field communication (NFC) fraud-related complaints. She said that the losses suffered are in the millions, with customers' accounts fraudulently drained through tap-and-go purchases made with smart devices in mostly foreign jurisdictions such as Dubai, France and Spain while the legitimate cardholders were in South Africa.
"This is a clear indication that an international crime syndicate is operating within this space and has South African consumers in its sights," Steyn warns.
She says one of the major banks in South Africa has confirmed with her office that it received more than 6,000 NFC fraud-related complaints in the 18 months between January last year and the beginning of June this year. The bank's stats show that in the first six months of last year, about 553 customers fell victim to this fraud with their losses amounting to about R430,000. This year the number of victims jumped to more than 5,450 with combined monetary losses exceeding R6.5-million.
"These are highly concerning numbers and the devastation of the losses caused has the potential of causing bank customers serious financial hardships which in some instances may be impossible to...