Security is Becoming a Bigger Priority for Young Banking Customers

Nigeria’s fintech companies are facing a new test in winning young customers as security moves higher on the list of priorities for users who increasingly depend on digital platforms to move, receive, and spend money.

Speed, convenience, free transfers and rewards still influence how customers choose digital financial platforms. But as more Nigerians use these platforms for everyday payments and money transfers, security is becoming an increasingly important part of the decision.

The financial services ecosystem continues to expand rapidly, and with that growth comes a greater need to protect users from fraud and other digital threats. 

According to the Nigeria Inter-Bank Settlement System (NIBSS), losses to digital payment fraud fell to N25.85 billion in 2025, from N52.26 billion in 2024. While the decline is encouraging, fraud remains a huge concern for consumers and financial institutions, particularly as fraud tactics continue to evolve. 

Against this backdrop, a recent PalmPay user survey among university students in Lagos indicates how younger digital banking users are thinking about security. 

When respondents were asked which PalmPay security features they used most, Transaction Guard ranked second only to login passwords, ahead of Night Guard and other available security features.  

While a password is required for account access, Transaction Guard is an optional feature that users actively enable, suggesting that protection is becoming a conscious part of their payment habits.

Security also featured prominently in how respondents described their experience with PalmPay, with words such as “secure,” “reliable,” “efficient,” and “trusted.” 

For PalmPay, the findings reinforce the importance of making security an integral part of the users’ experience. 

“When it comes to digital payments, convenience alone is no longer enough,” Femi Hanson, Head of Marketing, PalmPay, said. 

“Customers want an experience that is fast, rewarding, and easy to use, but they also want confidence that their money is protected. Giving users greater control over how their transactions are secured is an important part of delivering on that confidence.”

The shift in consumer behaviour could make security a stronger differentiator for fintechs competing for Nigeria’s young digital banking population.

As users conduct more of their daily financial activities through apps, features that give them greater control over transactions may become as important as transfer speed, rewards and ease of use.

For fintechs, the challenge is no longer only getting young Nigerians to open accounts. It is keeping their money safe enough for them to continue using those accounts.