Fintech apps have transformed how Africans abroad manage money. You can open accounts in minutes, send money home instantly, hold multiple currencies, invest in stocks and pay bills from your phone. But the same convenience attracts fraudsters, and not every app offers the protection you might assume.
Here’s how to use fintech safely.
Know What Type of Company You’re Using
Fintech providers come in different forms:
- Licensed banks: can hold deposits, often covered by deposit protection schemes
- E-money or payment institutions: hold customer funds under different rules, which may not include deposit guarantees
- Investment platforms: regulated as investment firms, with separate protections
- Crypto platforms: often lightly regulated or unregulated in many countries
Understanding the difference helps you decide how much money to keep with each provider.
Check Regulation Before Signing Up
Always confirm that a fintech is authorised in your country. In the UK, you can search the Financial Conduct Authority register. In the US, check state licensing and relevant federal regulators. In Canada, check FINTRAC registration for money services businesses. For Nigerian fintechs, check whether they’re licensed by the Central Bank of Nigeria or the Securities and Exchange Commission, depending on their services.
Watch for “clone” companies using the names of legitimate firms.
Protect Your Login
- Use a strong, unique password for each app
- Enable two-factor authentication
- Use biometric login where available
- Never share one-time passcodes with anyone
- Download apps only from official app stores
- Keep your phone’s software updated
Beware of Social Engineering
Most fintech fraud doesn’t involve hacking. It involves tricking you. Common tactics include:
- Fake customer support accounts on social media
- Calls claiming your account is compromised
- Messages asking you to “verify” your details through a link
- Requests to install screen-sharing apps
Contact support only through the official app or website.
Don’t Keep All Your Money in One App
Spread your money across providers. Keep your main savings in a regulated bank with deposit protection, and use fintech apps for transfers, spending and specific purposes.
Watch for Account Restrictions
Fintechs have compliance obligations like banks and may freeze accounts during reviews. Keep documents ready to explain the source of funds, especially for large or unusual transactions.
Be Careful With Investment and Crypto Apps
Apps promising high returns, trading signals or “guaranteed” profits are a major source of losses in diaspora communities. Before investing:
- Confirm the platform is regulated for investment services
- Understand what you’re buying
- Never invest money you can’t afford to lose
- Avoid anyone asking you to transfer funds to a personal wallet or account
Check Fees and Exchange Rates
Fintech apps can be cheaper than banks, but not always. Compare exchange rates and fees before sending money home, and watch for hidden margins in “zero fee” offers.
Keep Records
Download statements periodically. If a provider shuts down or restricts your account, having records helps you prove what you’re owed.
What to Do If Something Goes Wrong
- Freeze your card or account in the app
- Contact the provider through official channels
- Report fraud to your bank and relevant authorities
- Use complaint procedures and ombudsman services where available
Secure Your Phone Itself
Your phone is now your bank. If it’s lost or stolen, anyone who unlocks it may access your money. Use a strong screen lock, enable remote wipe and “find my device” features, and avoid storing passwords in notes or photos. Keep a list of your fintech providers’ emergency contact details somewhere safe so you can freeze accounts quickly if your phone goes missing. Be careful when using public Wi-Fi for banking, and log out of apps on shared devices.
Final Thoughts
Fintech apps can save diaspora Africans time and money, but safety starts with you. Check regulation, secure your logins, beware of social engineering, spread your money wisely and stay sceptical of high-return promises.