Despite a 30% increase in Know Your Customer (KYC) onboarding in Africa, the crypto industry appears to have faced the fewest fraud cases, according to the most recent KYC fraud report from the industry leader in KYC services, Smile Identity.

The ‘Know Your Customer (KYC)’ process is a requirement that helps businesses identify their users and verify their credentials.

The report states, “Buy Now Pay Later (BNPL) companies are seeing high rates of fraudulent attempts as fraudsters try to get away with more opportunistic crimes. On the other hand, crypto companies in Africa are noting lower fraudulent attacks than expected.”

“Large, difficult to trace, high-profile scams have plagued the crypto market often giving them a notoriously bad reputation and intense scrutiny from regulators. Yet, Smile Identity’s data shows that the crypto platforms are actually reporting a lower rate of attempted fraud than other industries,” the report added.

In addition, according to the report, BNPL takes the lead with 39%, investments and savings follow with 31%, banking and lending and professional services take third place with 14%, remittances follow with 12% and then crypto has the least KYC frauds with 12%.

Fraud attempts have also increased by 55% in the last 2 years, according to the report.

The research also reveals that fintech and cryptocurrency service providers throughout the continent have increased their use of remote KYC services by roughly 30%. It also adds that regulatory compliance and fraud protection are the two main reasons why fintech and cryptocurrency companies perform KYC checks.

Smile Identity plugs its software to Identification (ID) databases across several jurisdictions including Kenya, South Africa, and Nigeria.

Additionally, their research shows that in H1 2022, biometric fraud decreased in the other two nations but increased in Kenya.