Rise in AI-Driven Scams Poses New Threats to Kenya’s Digital Banking Sector
Head of Forensics, Fraud and Physical Security at Absa Bank Kenya PLC,George Maracha
By George Maracha
Kenya’s fast-growing digital economy is facing an alarming spike in cyber fraud, with artificial intelligence (AI) now fueling a new wave of scams targeting individuals, families, and financial institutions. From AI-generated impersonation to sophisticated phishing techniques, fraudsters are increasingly exploiting digital vulnerabilities, prompting urgent calls for vigilance and collaboration across the banking sector.
Recent statistics paint a stark picture. Cybersecurity firm Kaspersky Africa reports a 438 percent surge in fraud cases in Kenya, positioning the country among the most targeted in Africa alongside Nigeria and South Africa. Similarly, data from Concryt reveals high levels of search activity related to Authorised Push Payment (APP) fraud in Kenya, Ethiopia, and other regional hubs highlighting growing public concern over digital security.
One disturbing incident involved AI-generated YouTube ads that mimicked top executives from a prominent local investment firm. The deepfake videos lured unsuspecting viewers to malicious links, illustrating the lengths to which fraudsters are now going and the increasing ease with which digital tools can be weaponized.
“Cybercriminals have moved beyond traditional fraud. We are now seeing advanced social engineering schemes and AI-enhanced deception that prey on human trust,” said the Head of Forensics, Fraud and Physical Security at Absa Bank Kenya PLC.
In response, Kenya’s banking industry is ramping up efforts to counter the threat. Technologies like Chip and PIN have been rolled out to protect card users, while institutions continue to bolster backend fraud monitoring systems. The Kenya Bankers Association (KBA) is also playing a central role through its Kaa Chonjo public awareness campaign launched in 2010 to promote safe digital banking habits.
Despite these efforts, fraudsters are constantly evolving. Social engineering attacks, phishing emails disguised as official bank communication, baiting scams using enticing offers, and fraudulent SMS messages now form part of the daily threat landscape. Around key salary dates, such schemes often spike preying on emotionally vulnerable users.
Financial institutions are urging customers to stay alert. Common advice includes avoiding suspicious links, verifying contacts before sharing personal data, and never disclosing passwords, OTPs, or sensitive identity details no matter how convincing the request appears.
“Impersonation remains one of the most emotionally damaging tactics. Fraudsters mimic friends or bank staff to gain trust, causing real harm both financially and psychologically,” added the Absa Bank executive.
In a bid to enhance public resilience, Kenyan banks are taking part in global initiatives like International Fraud Awareness Week, and increasing direct engagement with customers through education drives.
“As fraud tactics become more complex, especially with AI-powered scams and deepfakes, we must continually update our defences and foster trust with our customers,” the official emphasized. “The fight against fraud is not one we can win alone it requires a united front from banks, regulators, and the public.”
With cybercrime evolving at breakneck speed, the message is clear: digital convenience must be matched with digital caution.
