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Mobile Money

By Lara Gilman

Mitigating the risk of fraud through customer communication

Mitigating the risk of fraud through customer communication

As the mobile money industry continues to grow, the topic of risk management will become increasingly important. Our recent publication, “Managing the risk of fraud in mobile money,” discussed one approach to risk management that operators can use for mobile money. In addition to addressing the strategy of risk management, we also highlight three fundamental tools that operators can leverage to manage risk:

  • relevant data and dashboards,
  • defined internal procedures, and
  • clear communication.

For this blog post, I’m focusing on the last of these tools: communication, particularly as a way of educating and protecting customers. I’ll describe why communication is so important to risk management and discuss some guiding principles that operators can use when developing an effective communication campaign.

Customer communication is important to risk management because uninformed customers are more susceptible to fraudsters.

Often, when we talk about communication, we’re talking about marketing. Campaigns, direct marketing and other promotions typically focus on driving customer adoption. However, communication is also a powerful tool to inform and educate customers on protecting themselves against fraudsters.

Vishing/Smishing scams illustrate the need for communication beyond marketing. Vshing/Smishing scammers rely on either voice or SMS channels to trick customers into sharing personal information such as a PIN. These scams are effective because scammers can capitalize on the reality that for many mobile money customers, the concept of a PIN is new and therefore customers may not be aware of how valuable it is. We’ve seen evidence of this in even the more advanced mobile money markets.  According to the Tanzania Mobile Money Tracker conducted by Intermedia and The Bill & Melinda Gates Foundation, 29% of registered active mobile money users in Tanzania have shared their PIN in order to access a mobile money service.

This is a concerning statistic for operators because customers who are defrauded will not only lose their savings but will also lose trust in the service. Technologically, there is no way for an operator to block a customer from freely sharing his or her PIN. Therefore, one of the best controls to mitigate this type of risk is to build customer awareness through education. The best means to educate customers is through an effective communication strategy.

Effective customer communication is relevant, simple and supported by the channel.

For customer awareness campaigns, operators have massive advantage (compared to a typical marketing campaign) because they know where their customers are and where they go to transact.  The challenge is therefore creating and reinforcing a message that is actionable and understandable to the customer. Here are three guiding principles to get the messaging right:

1.)    The message should be relevant and specific, but not scary. A good customer awareness campaign will address a risk without causing customers to be concerned when interacting with the service. In our publication, we highlight Safaricom’s Know Your PIN campaign as an effective and relevant customer awareness campaign. This campaign does not mention the risks around Vishing/Smishing scams, but it does provide customers with the information they need to guard against such scams.

2.)    The message should be simple and easy to understand. Operators need to think creatively about constructing and disseminating the right message effectively. While operators are only targeting customers (and therefore have the luxury of knowing how to find them), there still may be other barriers to consider including language and literacy. Therefore, risk managers, marketers and, where necessary, advertising agencies will need to work closely to create an effective message that will resonate with the broadest possible customer base.

3.)    The message should be reinforced during customer interactions. This third point is the most important element to building customer education. The above two points discuss the strategy for messaging, but good messaging will only work if it is properly reinforced.  Reinforcing the message is the responsibility of the agents, the customer care centre and any other stakeholders who work with customers on a regular basis. Operators need to invest in training these stakeholders to ensure they are aware of messaging and follow standard procedures to reinforce customer education during practical situations. Agents can often be fraudsters themselves, making agent training and monitoring critical for customers protection and risk management. For more insight on constructing an effective training curriculum, see MMU’s publication on agent training.

This post is part of a series that provides operators with greater insight on the tools to manage risk in mobile money. The next post will focus on creating clearly defined internal procedures. For more information about how to think about risk management in mobile money, see our article “Managing the risk of fraud in mobile money.”


  1. This is an excellent read.

    It is very important for the operators to protect their customers for any kind of fraud or scams proactively through meaningful conversations.
    From a broader perspective, Fraud risks leading to customer dissatisfaction might not only affect their Mobile Money business, but also dent their core Mobility business, which in turn is a bigger loss.
    Beyond normal communication and campaigns, few operators are also using social media to reach out to their tech savvy users with their right messaging.

  2. Interesting read. Thank you. I should point out that the study cited is actually from the Tanzania Mobile Money Tracker, not the FITS survey.

  3. Ravish, you’ve raised a good point on channel options. Reaching customers may go beyond SMS blasts and merchandising, and operators should consider other methods depending on what gets traction in that market.