Banking Security in Nigeria with Biometrics & Passkeys

Nigeria’s financial landscape is at a critical point, caused by escalating cyber threats and rising consumer expectations for seamless digital experiences. In the quarter of 2024 alone, fraud losses reached ₦. billion (approximately $ million), yet 70% of Nigerians say they want mobile banking tools that feel as intuitive as their favorite social apps. This tension underscores a single reality for enterprise leaders: authentication methods must be both robust enough to defend against sophisticated attacks and simple enough to retain a demanding user base.

Traditionally, many Nigerian institutions have relied on the nationwide Bank Verification Number (BVN) framework launched in partnership with the Central Bank of Nigeria (CBN). Since 2014, BVN has unified individuals’ biometric data across multiple accounts, and by 2025 it secured the data of more than 64 million customers. Yet even with this extensive foundation, a new wave of fraudulent tactics, ranging from synthetic IDs to deepfake-based account takeovers, has pushed banks to explore other advanced solutions authentication solutions. This shift toward biometric authentication also linked with the emergence of passkeys, which store cryptographic keys on a user’s device for a simpler, password-free experience.

This blog takes a closer look at why biometrics and passkeys are vital in Nigeria, how major banks and fintech innovators are deploying next-generation authentication solutions, and what challenges and opportunities lie ahead for the country’s digital economy. The core three questions covered will be:

1. Why is biometric authentication becoming more important in Nigeria’s financial sector?

2. How are Nigerian banks and fintech companies implementing advanced biometric solutions?

3. What challenges and future opportunities exist for biometric authentication in Nigeria?

The move toward comprehensive biometric systems in Nigeria is being pushed by three major:

1. Fraud is more sophisticated than ever. Cybercriminals increasingly exploit stolen or synthetic identities tied to BVNs, bypassing older authentication processes.

2. Consumers show an impatience with clunky security checks, with 64% of Nigerians abandoning apps that use multi-step logins in favor of simpler, one-tap alternatives.

3. New regulations from the Central Bank of Nigeria require biometric multi-factor authentication for large transactions, making advanced face or fingerprint checks non-negotiable for serious market players.

Because of these developments, many banks now view biometrics not just as a security measure but as a tool for brand differentiation. Adeola Okeowo, Chief Risk Officer at Polaris Bank, describes it succinctly: “Biometrics are no longer a ‘nice-to-have’ - they’re the bedrock of customer retention in Nigeria’s hyper-competitive market.” Alongside biometrics, passkeys are beginning to attract attention as another low-friction method for authentication. These cryptographically secure credentials eliminate the need for passwords entirely, offering an experience as simple as tapping a user’s device.

Facial authentication in Nigeria has passed through several phases over the last decade. Early systems in the 2010s relied heavily on static image matching in BVN databases but were easily fooled by simple photo spoofing.

The early 2020s saw the introduction of liveness detection features, such as blinking or slight head movements, which provided some defense against video replays.

By 2024, these capabilities advanced even further into what experts term “genuine presence assurance,” where 3D challenge-response tests (like tilting one’s head or smiling) effectively thwart sophisticated deepfakes and AI-generated video manipulations.

Within Nigeria, some of the largest banks are leading the charge with dedicated biometric solutions. Access Bank, for instance, has rolled out facial biometric payment systems to simplify retail transactions, offering a password-free environment for elderly customers and those less comfortable with conventional digital banking. The bank also introduced facial recognition ATMs that currently serve more than 200,000 users per month, significantly reducing PIN-entry errors. Polaris Bank’s VULTe platform takes a similar approach by verifying user selfies against BVN records, cutting manual verification costs by ₦480 million (about $416,000) each year.

Wema Bank has integrated solutions into its ALAT mobile app, combining document checks with facial recognition to improve security.

GTBank is similarly transparent about its reliance on biometric verification, publishing consent notices that reassure customers about the proper handling of their sensitive data.

These efforts are supported by extensive government initiatives, including a $45.5 million investment from the World Bank that aims to register 200 million citizens in the National Digital ID Program by 2025. Already, over 115 million people use biometric ID cards that unite banking, healthcare, and tax services, and future expansions will bring more banks on board for utility and government benefit payments.

Passkeys fit neatly alongside these projects, offering an additional layer of frictionless security. Because passkeys store cryptographic keys locally on a user’s device, they can alleviate some of the infrastructure and cost issues associated with rolling out specialized 3D sensors or other hardware-based biometric solutions

Even as biometric systems mature, significant hurdles remain. Facial recognition technologies can reject anywhere from 6–13% of legitimate users due to issues with lighting, evolving facial features, or older BVN data. UBA has been testing a solution that layers voice authentication on top of facial scans, bringing error rates down to 1.8%. Cost is another major issue, as implementing 3D sensors at physical branches can range from $8 to $15 per device.

Data protection and regulatory compliance add complexity, particularly as global regulations intersect with local laws. Nigeria’s Data Protection Act (NDPA) mandates on-site storage and strong encryption for biometric data, but that hasn’t prevented banks with international operations from facing penalties under external regulations, as in the recent case of GTBank’s $2 million GDPR fine. Here, passkeys could offer a compliance advantage by keeping sensitive credentials under user control, reducing the burden of storing high-risk data on institutional servers and cutting costs.

Wema Bank’s experience demonstrates the tangible benefits of integrating advanced biometric technologies. Before 2024, the institution was losing ₦685 million (almost $594,000) per year to SIM-swap and phishing fraud. By deploying liveness detection for high-risk transactions and incorporating AI-based BVN checks for mobile logins, fraud losses fell by 89% during the first half of 2024. Customer support costs also dropped by 22% as fewer accounts ended up locked due to suspicious login activity.

Although Wema Bank’s solution centers on facial biometrics, the growing interest in passkeys could pave the way for a hybrid approach. Such a method might let users authenticate with a biometric scan on one occasion and rely on a passkey for low-risk actions, thereby balancing security and convenience.

In a country with multiple regulatory demands, leading enterprises are shaping a compliance-first framework to manage both fraud prevention and customer loyalty. Many banks, such as Zenith Bank, prioritize local data storage by using NCC-approved data centers, thereby reducing sovereignty risks. Fidelity Bank’s enrollment process incorporates NDPA-compliant consent forms, achieving a 78% customer approval rate for storing biometrics.

Passkeys also integrate well into a compliance-centric model. Because they rely on public-key cryptography stored locally on the user’s device, they can help institutions sidestep some data residency issues that come with traditional username-and-password databases.

Nigeria’s long-term trajectory mirrors global success stories like India’s Aadhaar system, where over 1.4 billion users benefit from a wide range of biometric checks. Lessons learned in similar large-scale deployments show that multi-modal authentication, face, fingerprints, behavior, and device-based passkeys, reduces the reliance on any single method’s accuracy and resilience. Public-private partnerships remain essential for driving adoption in rural areas, aligning with Nigeria’s ambitious goal to register 180 million citizens for digital IDs by 2026.

Biometrics have become a decisive factor for financial institutions hoping to survive in Nigeria’s hyper-competitive market. By adopting genuine presence assurance, balancing compliance with global and local regulations, and cultivating strategic public-private partnerships, banks can significantly reduce fraud while meeting consumer demand for instant, effortless access. At the same time, passkeys offer a parallel track for frictionless, secure logins that enhance the user experience across both mobile and web platforms. In summary we learned the answeres to these questions in this blog:

• Why is biometric authentication becoming more important in Nigeria’s financial sector? Biometric authentication is important due to increasing fraud complexity, evolving regulatory mandates, and consumer demand for seamless, secure digital banking experiences.

• How are Nigerian banks and fintech companies implementing advanced biometric solutions? Leading banks are integrating liveness detection, 3D facial recognition, and multi-modal biometric verification, while fintechs are leveraging API-based authentication and passkeys for cost-effective security.

• What challenges and future opportunities exist for biometric authentication in Nigeria? Challenges include fraud resilience, high deployment costs, and compliance with both local and international regulations, but future opportunities lie in hybrid authentication methods, AI-driven fraud prevention, and expanded public-private partnerships.