GTCO’s subsidiary HabariPay in distress amid recovery battle of N1.1bn mistakenly paid to customers

HabariPay, the fintech arm of Guaranty Trust Holding Company Plc (GTCO Plc), is working to recover N1.1 billion mistakenly credited to thousands of customers in 2023.

Last week, a federal high court in Lagos ordered over 40 financial institutions to freeze accounts that received the erroneous funds.

The error occurred when merchants were credited twice, and HabariPay is now working to get the extra payments back.

Affected merchants are being contacted to return the excess funds, while those who remain unreachable will be compelled to comply through court orders.

Court documents suggest that the double payments might have been caused by a hack involving race conditioning, while some sources linked the incident to human error.

Before resorting to legal action, HabariPay had successfully recovered some funds by directly contacting merchants.

However, the legal process was necessary for accounts that could not be reached.

This case underscores the challenges financial institutions face in Nigeria, where slow legal processes often hinder the swift recovery of lost funds.

Additionally, it highlights the growing threat of fraud in Nigeria’s financial sector, where $25.7 million was lost to fraudulent activities in the second quarter of 2024 a staggering 1,784.94% increase from the previous quarter.