Smile ID, Africa’s leading digital identity verification, fraud detection, anti-money laundering, and KYC compliance solution for businesses has released its 2025 Digital Identity Fraud report, highlighting fraud trends and emerging fraud across the African continent.
The report based on a comprehensive analysis of over 110 million identity verification checks conducted by Smile ID in various industries across Africa, reveals that fraud has become more complex, as AI provides fraudsters with new sophisticated tools for attacks. These fraudsters are using advanced technologies, such as generative AI and deepfakes, to exploit vulnerabilities with greater precision.
Once a weakness is discovered, it is exploited at scale, driving large volumes of attacks through a single entry point. These evolving tactics pose significant risks to trust, revenue, and operational stability.
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The report further revealed that fraudsters are exploiting weaknesses in Africa’s verification and security systems, targeting vulnerable platforms and institutions to infiltrate critical systems. Deepfake incidents surged sevenfold from Q2 to Q4 as accessible AI tools lowered the barriers to creating fake identities and manipulating biometric data.
Notable incidents, such as the impersonation of the African Union’s Chairperson using deepfake technology, demonstrate how these attacks undermine trust in financial and civic institutions across the region. Selfie anomalies accounted for 34% of emerging biometric fraud cases.
Speaking on the report, Mark Straub, CEO of Smile ID, said,
“The future of fraud prevention lies in adaptability. While Al provides fraudsters with powerful new tools, it also helps security practitioners harness global intelligence to counter zero-day attacks and automate processes that were once manual.”
Key Takeaways
Biometric Fraud Rate Hits a Quarterly All-time High of 16%
Biometric fraud attempts spiked to a quarterly average of 16% in 2024, its highest in three years, felled by increasingly sophisticated Al-driven attacks. Businesses must act now to strengthen their biometric defenses to counter this growing threat.
Fraud 4x Higher at Authentication Than Registration
In 2024, fraud attempts during user authentication were four times higher than at registration, highlighting the acute threat)of account takeover and not just fraudulent account creation.
SDKs Detect Twice as Much Fraud as Other Integration Methods Combined
Fraud detection through Mobile SDKs accounted for 68% of all cases, compared to 32% from other integrations. This highlights the growing adoption of Mobile SDKs by our customer base and their superior effectiveness in preventing fraud.
Dynamic Liveness Detection; the Best Bet against Generative Al Fraud
Dynamic liveness detection is the most effective defense against Al-driven fraud, Real-time, unpredictable prompts can add friction to UX but they block deepfakes, generative Al faces, and replay attacks while ensuring accurate user verification.
East Africa Leads with 27% Rejection Rate Due Reliance on Documents
East Africa recorded Africa’s highest biometric and document verification rejection rate in 2024, rising from 16% to 27% year-over-year driven by the reliance on outdated, inconsistent, and poor-quality identity documents, which hindered the verification processes.
Financial Sector Leads in Fraud Exposure
Digital banks recorded peak fraud attempts at 35% of all biometric and document verifications in 2024, followed by microfinance at 30%. These institutions remain prime targets for sophisticated schemes combining identity farming, account takeover, and money laundering.
Notably, document fraud remains a persistent form of identity fraud in Africa, thriving in markets slower to adopt technology and digital verification. Fraudsters manipulate physical or digital identity documents to bypass verification checks.
Traditional document fraud methods include forgery, where fraudsters create entirely fake documents; alteration, where genuine documents are modified (i.e..changing expiry dates), and obscured documents, where critical information is concealed or distorted to avoid detection. While these methods remain common, advancements in verification technology have significantly reduced their effectiveness.
In a bid to combat fraud, several African countries are adopting digital ID systems to enhance security and reduce fraud in identity verification. Digital identity systems are rapidly transforming the landscape across Africa as governments roll out digital IDs to drive identity verification, financial inclusion, and access to essential services.
With over half of African countries pursuing or implementing digital ID initiatives, this shift is set to impact businesses across industries, creating both opportunities and challenges. For businesses, digital IDs offer the potential for real-time verification, automation, and streamlined operations.