Bankers association urges aggressive investment in systems

Banks must consider a more aggressive investment in systems that can easily and securely interface with those of their clients, regulators and other stakeholders, if they are to stay relevant in the future post-COVID-19, the Ghana Bankers Association (GAB) has said.

The association’s Deputy Chief Executive Officer, John Awuah, noted that banking will be completely transformed post-COVID-19 due to the fast uptake of digital channels, which has accelerated over the last four months.

“Banks should therefore be open in the post-COVID-19 era to consider a more aggressive investment in systems that can easily and securely interface with those of their clients, regulators and other stakeholders for seamless transaction processing and real-time supervisory controls,” he said.

“We will begin to see a gradual move away from the transactional applications that banks used to have—like checking balance, requests for cheque books and the rest—to those systems that enable deeper customer engagement, such as systems that will respond to targeted customer profiling and journey mapping.”

Accounting and consulting firm Deloitte’s analysis of COVID-19’s potential implications on banking and capital markets, published last month, said going forward, digital systems that enable deeper customer engagement will be key to meet customer demands and avoid non-performing loans.

“Lending and access to capital is likely to be more stringent as businesses are adversely impacted. Companies with in-built resilience will have the advantage in accessing capital,” the consulting firm said.

“[There will be] pressure on banks to invest in expansion of infrastructure and improve service quality, such as investment in more e-banking options. [There will also be] increased probability of loan default as other businesses experience financial distress as a result of COVID-19,” it added.

Due to the stringent restrictions imposed in the country since March to help contain the coronavirus outbreak, the public has turned massively to digital channels to transact banking business.

This has led to a sharp increase in the number of customers now using these channels and taken customers away from physical bank branches.

Mr. Awuah believes that this trend will continue and will put pressure on existing systems, hence the need for banks to continue investing in technology.

“Big data analytics will also become important to the business of banking. Technology as we know it now, in our estimation, will no longer be just an enabler of banking business, but it will become the business of banks in the future.”