Banks and telecom firms should embrace new technologies like interoperability of their electronic commerce platforms to reduce fraud, an expert has said.

David Karuletwa, the chief operating officer of RSwitch, argued that it would be easier to track cases of fraud, if all banks and telecom sector players linked their e-commerce platforms. RSwitch, a private company in charge of facilitating electronic payments in the country, manages every transaction that is channelled through it. 

Speaking in an interview with The New Times, Karuletwa said it is easy to track transactions when banks or telecom firm’s platforms inter- operate. 

"Synchronising the systems so they work together compounds the cost to one central point, allowing compliance, oversight, eases risk management and ensures low costs for the end-users,” he explained.

He added that without interoperability, fraud cases are clustered, making it hard to trace where a theft took place. 

Presently, thousands of Rwandans use electronic payment methods. Innovation is also central in facilitating access to financial services and a cashless economy. Big and some small-and-medium taxpayers use e-platforms to file tax returns, while millions of Rwandans with mobile phones use the mobile money transfer facility.

Karuletwa said it is important for sectors to inter-operate, adding that the initiative has been embraced by the banking and telecom industries. 

Recently, I&M Bank partnered with airtel money to develop an integrated service to allow airtel money clients to access cash on their mobile money account or I&M Bank account through an ATM machine. 

Karuletwa added such innovations help organisations to cut costs as they will not be paying services like ‘cash-in-transit’. This could eventually lead to better lending rates as banks would accumulate deposits to lend to the private sector.

However, according to Saddiq Mwai, a technology advisory services director at PricewaterhouseCoopers Rwanda, interoperability may not reduce fraud per se. He notes that even with interconnected systems, banks and other sectors will still need to employ strict anti-fraud measures.

"The biggest bottleneck that would arise with interoperability is the time taken by banks to reconcile transactions,” he explained.

He added that much as interoperability enhances financial inclusion, banks need to put even tighter measures, and reconcile the transactions faster in order to reduce fraud.

"It is the responsibility of the banks to ensure no fraud takes place because a fraudster can easily steal from one bank to another using a credit card since it’s about knowing the card’s pin number,” Mwai explained in an interview with The New Times yesterday.

A recent survey by KPGM, "Global Profiles of a Fraudster; White collar Crime–present and future” indicated that there was an increase in bank fraud.