ADF Approves $8m to Improve Banking System in Liberia, Gambia, Others
By Boniface Ihiasota, USA
The Board of Directors of the African Development Fund (ADF) has approved $8 million to enhance the banking system in Africa, according to a statement by the African Development Bank (AfDB).
The funds will establish a digitally interoperable unique bank identification system, and a harmonised customer identification framework in the Gambia, Guinea, Liberia, and Sierra Leone.
The West African Monetary Institute (WAMI) will lead the project, working with central banks in the participating countries, and in close collaboration with banking and non-banking financial service providers.
The project will commence in July 2023.
The initiative is expected to boost financial sector efficiency, increase access to finance and facilitate further regional integration efforts.
Over 53 financial service providers across the participating countries will be included in the project, which will link the banking accounts of individuals across different financial service providers to enable Know-Your-Customer (KYC) verification on an ongoing basis, combat fraud, discourage loan defaulting and strengthen correspondent banking relationships.
The Unique Bank Identification (UBI) and Digital Interoperability project, which was borne from the Bank Verification Number (BVN) success implemented by the Central Bank of Nigeria, will leverage existing national identification systems to strengthen financial integration in the West African Monetary Zone.
The BVN, an 11-digit unique identity for each individual across the Nigerian Banking industry, is tied to all bank accounts and has helped reduce electronic banking fraud, non-performing loans and eliminated ghost names from the civil service payroll.
Ahmed Attout, AfDB Director for the Financial Sector Development Department, welcomed the board’s approval, noting that it attested to the strong partnership between the Bank and WAMI.
He observed that irrefutable and secure identification is fundamental to building financial consumer access and trust, and overall development of the financial sector.
