The Board of Directors of the African Development Fund (ADF), the concessional lending window of the African Development Bank (AfDB) Group, has approved $8 million in financing for the establishment of a digitally interoperable single bank identification system and a harmonized customer identification framework for The Gambia, Guinea, Liberia and Sierra Leone.
The announcement was made through a press release published Friday on the AfDB website, which explains that the implementation of the project will begin in July 2023, under the leadership of the West African Monetary Institute (WAMI), in collaboration with the central banks of the participating countries and with the active participation of banking and non-banking financial service providers.
It is stated that the project is expected to improve the efficiency of the financial sector in participating countries, leading to increased access to finance and further regional integration efforts. The new bank identification system will irrefutably and uniquely link customers to all their bank accounts with different financial service providers.
More than 53 financial service providers in the participating countries will take part in the implementation of the project, which will improve their ability to verify in real time and on a continuous basis the identity of their customers (Know-Your-Customer or KYC) and to combat fraud, discourage payment defaults and strengthen correspondent banking relationships, the statement also explains.
On the client side, compliance of financial service providers with KYC requirements will build trust and ultimately encourage access to and use of financial solutions.
According to WAMI Director General, Olorunsola E. Olowofeso, “The Single Bank Identification (UBI) and Digital Interoperability project grew out of the success of the Bank Verification Number (BVN) implemented by the Central Bank of Nigeria ».
This BVN, he continues, is a unique 11-digit identifier that links every customer in the Nigerian banking sector to all their bank accounts. Its implementation has led to a drastic reduction in electronic bank fraud, non-performing loans and the elimination of fictitious civil servants from the civil service payroll in Nigeria.
« Irrefutable and secure identification is fundamental to strengthening access and confidence of consumers of financial products and the overall development of the financial sector », observed, for his part, the director of the department in charge of the development of the financial sector at AfDB, Ahmed Attout, satisfied with the approval of the project by the ADF Board.
By OMA Newsletter N° 1123 of 08/04/2023
Article published under the direction of Dr. Najib Kettani
The OMA, NGO with an Intercontinental vocation
For the development of cultural exchanges
Valuing human potential
The promotion and consolidation of Africa’s development, and
Inter-African integration
