The African Development Fund (ADF) has allocated $8 million to the West African Monetary Institute (WAMI) to help promote improved banking identification and financial sector efficiency within the West African Monetary Zone.

The project is part of efforts by the fund to enhance efficiency in the financial sector in participant countries, aimed at increasing access to finance and regional integration.

The Board of Directors of the fund, approved the $8 million to establish a digitally interoperable unique bank identification system and harmonised customer identification framework for The Gambia, Guinea, Liberia and Sierra Leone.

The Director General of WAMI, Dr. Olorunsola E. Olowofeso, said the project was borne out of the success of the BVN implemented by the Central Bank of Nigeria, which enables every individual to be able to access all their bank accounts thereby reducing electronic banking fraud, non-performing loans and elimination of ghost names from the service payroll.

“The Unique Bank Identification (UBI) and Digital Interoperability project was borne from the success of the Bank Verification Number (BVN) implemented by the Central Bank of Nigeria. The BVN, an 11-digit unique identity for each individual across the Nigerian Banking industry, is tied to all bank accounts and has resulted in a drastic reduction in electronic banking fraud, non-performing loans and elimination of ghost names from the civil service payroll," he said.

He went on to say the move will help leverage leverage existing national identification systems and help to strengthen financial integration in the West African Monetary Zone.

The project is expected to commence in July 2023, led by the West African Monetary Institute (WAMI) which will be working with central banks of the participating countries as well as in close collaboration with banking and non-banking financial service providers.

The project is expected to enhance financial sector efficiency within the participating countries, leading to increased access to finance and further regional integration efforts. Approval of funding from the Bank’s concessional lending window was made on March 29, 2023.

This will allow banks verify their clients’ identities, combat fraud, discourage loan defaulting and strengthen correspondent banking relationships. The new identification system will link banking accounts of individuals across different financial service providers.

Also, over 53 financial service providers across the participating countries are expected to be included in the project.

The KYC will among other things, instill trust and confidence and ultimately, encourage access and usage of financial solutions.

The Director for the Financial Sector Development Department, African Development Bank, Ahmed Attout, welcomed the Board approval, noting that it attested to the strong partnership between the ADB and WAMI.

“Irrefutable and secure identification is fundamental to building financial consumer access and trust and overall development of the financial sector,” he observed.

NW/FNOQ