Expert rues challenges of EFT accounts reconciliation

EXCEPT banks and other financial institutions take with all seriousness and find a lasting solution to the challenges involved in Electronic Fund Transfer (EFT) account reconciliation, the impact may be grievous on the sector.

   These challenges, according to a technology expert and Managing Director and Chief Executive Officer, Precise Financial System (PFS), Yele Okeremi, is growing and may continue to grow unabated, until a major proactive approach is employed.

    Okeremi, a software expert, said reconciliation across the Automated Teller Machine (ATM), cards and other electronics platform transactions has become a nightmare to back-office systems custodians in the banking sector.

    According to him, the banks face myriads of challenges in this regard. Okeremi said because EFT more or less crept into the Nigerian system, which was as a result of technological disruption—people; innovations brought it to limelight, with so many people going into and some even forced and not understanding what they were actually going into.

    He said some of the banks went into EFT without getting the appropriate model, “though they claimed the transactions are working because money kept moving from one account to another, but lots of them are suffering major losses. It gets worse if it is a loss they are aware of and it is getting really worse because most of these banks don’t know about it, but they are losing much. Some of the the time they only gets to know that there are challenges when customers complaint and so they become reactive rather than been proactive….that is a challenge.

  “There are three levels of these challenges, which include losses that are reported, I don’t know the figure but I followed the process in 2014 and through NIBSS report, I was told that about N6 billion was lost to fraud. But I can say categorically that the losses are in trillions. There are some that are not published because the banks are shy to do so, that is the second level and lastly, majority of them don’t even know that such is happening. So, when extrapolation is done, you will find out that the losses are much more than what we see or read.”

     According to him, the challenges are not rocket science, they can be dearth with, “but it is about understanding it and take appropriate measures, which is one of the thing Clirec has been pushing in the industry.

     As such, Okeremi informed that PFS is organizing a forum in Lagos on Thursday, which will be showcase presentation on ‘EFT Accounts Reconciliation: Taming the monster’. He stressed that the forum, though specifically meant for the banks, “but if you look at the way I have described these challenges, they are not limited to banks, even customers have the issue, probably, they don’t know yet. If you really look at the Financial Inclusion strategy of the Central Bank of Nigeria, and knowing fully well that financial transactions go through the banks, so it’s an industry thing that will bring people together.”

    The PFS boss said the forum would focus more on finding lasting solutions to the problem amidst driving the financial inclusion strategy.            

     Those targeted includes; personnel in reconciliation department; inspection/internal control; audit, finance/accounts; international/local treasury; banking operations and relevant to financial institutions, manufacturing, oil and gas companies, telecommunications among others.