The verdict in three sentences
Cards and mobile money get defrauded in different ways: cards via stolen numbers and 90-day bank disputes, mobile money via friendly fraud and SIM swap. On cards, your weapon is 3D Secure plus velocity checks; on mobile money, it's beneficiary verification and traceability. A chargeback costs 15 to 25 USD in fees plus the lost goods: better to decline one suspicious order than to pay for ten.
Two rails, two threats
On card, the fraudster uses a stolen number, orders, receives the product, then the real cardholder disputes. The bank pulls the money from your account: you lose the product, the payment and pay dispute fees. Card chargeback rates in Africa sit around 0.5 to 1.5 % of transactions depending on sector (2026 order of magnitude).
On mobile money, fraud is different: the customer genuinely pays then claims they got nothing (friendly fraud), or a fraudster hijacks a number via SIM swap to drain a wallet. No classic bank chargeback here, but disputes and refund requests to handle manually.
2026 comparison: fraud by rail
2026 order of magnitude. Figures vary by average basket and sector (electronics and luxury are the most targeted).
| Rail | Typical fraud rate | Main threat | Avg incident cost | Dispute window |
|---|---|---|---|---|
| International card | 0.5-1.5 % | Stolen card, chargeback | 15-25 USD + goods | Up to 90-120 days |
| Local 3DS card | 0.1-0.4 % | Residual fraud | Fees + goods | 45-90 days |
| Mobile money | 0.2-0.8 % | Friendly fraud, SIM swap | Refund + delivery | Manual dispute |
| Cash on delivery | n/a (0 chargeback) | Refused / ghost parcel | 2,000-4,000 FCFA / return | Immediate |
The second table prices the anti-fraud tools and settings to put in place.
| Defence | What it does | 2026 indicative cost | Expected effect |
|---|---|---|---|
| 3D Secure (3DS) | Shifts liability to the bank | Included with PSP | -60 to -80 % card chargebacks |
| Velocity checks | Blocks X attempts / card / IP | Internal rule | Kills automated attacks |
| Number/card blacklist | Bans repeat offenders | Internal | -10 to -20 % repeat fraud |
| KYC on large baskets | Verifies identity above a threshold | Human time | Filters risky orders |
| Anti-fraud score (tool) | Scores each order | ~0.05-0.15 USD / check | Targeted decline of risky orders |
Calibrating your decline rate
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Decline too much and you lose real revenue; decline too little and you pay chargebacks. The right approach: apply 3DS systematically on cards, set a KYC threshold (e.g. verification above 150,000 FCFA basket), and only use manual decline on orders stacking multiple signals (mismatched address, foreign card, express purchase of resellable goods). Aim for a decline rate under 2 to 3 % of legitimate orders.
Mini case study
Tunde sells electronics online in Lagos, average basket 180,000 FCFA, 300 orders/month. Without 3DS he ran ~1.2 % chargebacks, i.e. ~3.6 orders/month lost: 3.6 x 180,000 = 648,000 FCFA in goods + ~50,000 FCFA in dispute fees = ~698,000 FCFA/month in losses. Turning on 3DS (liability shift) and KYC above 150,000 FCFA, he cuts ~75 % of chargebacks: losses drop to ~175,000 FCFA/month. Net gain: ~520,000 FCFA/month for a marginal tooling cost.
FAQ
Does 3D Secure scare customers away? It adds a step (OTP or biometrics), so a little friction. But it transfers chargeback liability to the bank: on high baskets it is near-mandatory and cuts chargebacks by 60 to 80 %.
How do I fight SIM swap on mobile money? Add an out-of-band confirmation on unusual transactions and watch for recent SIM changes on the operator side. For large amounts, manual verification remains the most reliable defence.
What is friendly fraud? A genuine customer who pays then disputes or demands a refund claiming they received nothing. The defence: signed proof of delivery, parcel traceability and timestamped payment logs.
Does cash on delivery avoid fraud? It removes card chargebacks but creates the ghost parcel risk (refused on arrival): 10 to 25 % returns depending on the city, at 2,000-4,000 FCFA per wasted trip.
Do I need a paid anti-fraud tool from day one? No. Start with 3DS, velocity checks and a blacklist — free or included. Move to a paid score (~0.05-0.15 USD/check) when your volume or basket justifies it.
Let's talk about your project. We secure your card and mobile money collections: 3DS, velocity checks, scoring and KYC calibrated to your basket. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
