The SIM card in a GSM mobile phone is the basis for identification of the caller. In transferring a SIM card from one phone to another, the identification is transferred to the other phone. This is important to consider in the case of mobile payments as it is possible to transfer your mobile money identity to another phone by means of a SIM card swap. Mobile money systems should cater for this eventuality by flagging SIM-cards that have been swapped or re-activated.In many countries legislation has been passed recently requiring mobile operators to register (and also to collect KYC information) for customers buying a SIM card (For instance read here and here). While this is a costly process and often difficult to implement, it is extremely helpful to improve the security basis for mobile financial services.
In a recent article produced in Nigeria (Read here) the author questions if SIM registration can lead to a reduction in mobile money fraud. While it is unlikely that SIM registration (on its own) will be able to reduce fraud, it can form the basis for systems that will combat fraud. SIM registration legislation is a step forward to creating systems delivering more secure payments.
2 comments:
Alot of people don't think that sim cards registration is to important . but they should be aware of it now . How important it is.
SIM registration in the case of Nigeria had nothing to do with mobile banking/money fraud prevention. It stemmed wholly from the emergence of armed kidnapping in many parts of the country and the use of mobile phones to make ransom calls. Perhaps in the future, as infrastructure grows, this registration policy will be applied in also preventing mobile money fraud, which for now, has a low incidence rate.
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