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By Obinna Chima
With few months to the proposed implementation of the Central Bank of Nigeria’s (CBN’s) policy which seek to reduce the dominance of cash in the economy, Oceanic Bank International Plc, has advised auditors of banks to ensure that the electronic payment industry is secured against both internal and external fraud.
Chief Executive Officer, Oceanic Bank, Mr. John Aboh, gave this advise in a speech titled: “From Cash-Based Economy to Cashless Economy: The Role of Bank Auditors,” presented at the 19th quarterly meeting of the Committee of Chief Inspectors of Banks in Nigeria (CCIBN) in Lagos at the weekend.
He also charged the auditors to ensure that banks re-align their processes to suit objective of the policy in order to avoid sanctions from the regulators. Aboh also urged the bank workers to ensure that their institutions are not exposed to unfavourable events and losses while adjusting to the policy.
The Oceanic bank boss listed the security requirements in the electronic payment system in banks to include infrastructure security, process integrity, transaction security and income assurance.
Aboh also advised the auditors to “Ensure that hardware, software, network and the channels that support e-payment in banks are not vulnerable and not easily compromised. To ensure that processes and other activities relating to e-payment in banks do not create loopholes that could induce irregularities and fraud.”
He also called on auditors to ensure that adequate risk assessment were carried out before the deployment of e-payment infrastructure, adding that the risk analysis should also measure the system’s vulnerability to items such as financial loss, inadvertent error, among others.
“The transition to cashless economy is inevitable. Lack of enabling legislation, not withstanding the stipulated sanction, would definitely enforce compliance. Moreover, the cities (Lagos, Abuja and Port Harcourt), designated for pilot run have welcomed the initiative having realised that the attendant benefits far outweigh the envisaged challenges.
“There is therefore need for bank auditors to be trained on the control of various e-payment platforms and transactions accounting. It is imperative that auditors are trained along with the operators, so as to keep them abreast of the developments in e-business processes. This will enable them recommend and institute effective control to guard against errors and fraud,” Aboh added.