Scam prevention in Kenya needs new approach study finds

Almost 80% of Kenyans use mobile phones to manage their money and over half face scam attempts. New research finds it is imperative to build resilience against fraud and halt the growing distrust in digital financial services.

Essex Economists are working with international colleagues to investigate how well people in Kenya, a world leader in digital financial services, identify phone scams and support policymakers to make fraud prevention more effective.

Dr Lisa Spantig, one of the leaders of the research, said: “Digital tools have enabled people around the world to access banking and financial services. The rise of these technologies, however, has been accompanied by an increase in fraud risks, which are often difficult to measure due to consumer underreporting or unawareness.”

Dr Elif Kubilay and Dr Spantig from the Department of Economics at the University of Essex conducted the research financed by Innovations for Poverty Action (IPA) to find out the scale of the problem.

They conducted an online survey of 1000 users to test the effectiveness of scam prevention education and their findings suggest that both channels and language used for anti-scam tips must be adapted to better protect all consumers.

Despite widespread fraud attempts, the researchers found that consumers were not likely to use formal complaints channels. When they do use these channels, consumers are unlikely to receive a prompt and effective resolution.

Half of the study participants received anti-scam tips, with sobering results.

Dr Spantig said: “Our findings show that current anti-scam tips are not effective in helping consumers distinguish scams from genuine communication. However, confidence in their ability to spot a scam did rise for some consumers.”

The research findings are to be presented to an online conference for everyone interested in consumer protection, with a focus on policymakers across Africa. Panellists include a representative of the Competition Authority of Kenya, a researcher from IPA as well as part of the research team. The Director of the IPA Consumer Protection Research Initiative will lead through a program of background information, research findings, regulatory approaches and a Q&A.

Read all about the research in the report

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