For some days in the past few weeks, the country’s banking system was disrupted across the country. The development, which led to businesses and individuals getting frustrated, was said to have occurred following software upgrade by the affected banks.
While banks that are planning to follow suit are getting cautious to avoid a repeat of the situation, a software expert, Chris Uwaje, said the banking sector was facing the technology challenges due to lack of proper government policy on software application in Nigeria.
Speaking to New Telegraph, Uwaje, who is the Chairman, Mobile Software Nigeria, said the challenges would remain as long as Nigeria refuses to promulgate robust software policy and strengthen the local technology infrastructure.
He explained that though the banks depended on foreign tech service providers, there were aspects of the local technology they make use of in their operations.
It was gathered that the affected banks were trying to change their software to the local one due to high foreign exchange to pay for the imported one.
Sources from the banks revealed that they needed to divert their core banking system, the ported softwares used for banking operations to then locally built technology t beat their increasing investment due to forex.
About four commercial banks subjected their customers to hardship while the problem lasted. One of the banks tried to migrate its systems from T24 to SEABaaS, a new custom-built core banking locally-developed application, which caused disruptions in banking transaction.
Another disclosed that it was undertaking routine maintenance of its IT infrastructure to improve the quality of services.
Although the bank did not specify the exact nature of the maintenance, media reports revealed it involved migrating its core banking platform from Phoenix, software developed by London-based Finastra, to Oracle’s Flexcube.
This shut out many Nigerians from banking operations and left several customers stranded and frustrated after it extended for over a week. Beyond personal inconveniences, the upgrade delayed salary payments for many companies.
“We have had issues processing payment from our salary bankers, we could not do inter-bank transfer but we are finding an alternative way of paying the salary,” an affected employer said. Uwaje said: “Banking applications differ. They are many.
There’s what they call core banking, most of the core banking applications are really foreign services. “You have databases for management. You have resilient issues for their staff, which, of course, can be integrated into the system.
Though Nigerians develop the servers operating system, most of the time they are developed by the supplier of the hardware. “So one is to find out what is the specification of the server they are using.
So that’s where you can start. So if you know the specification of the server that they are using, and then, probably when they bought it, there is an agreement of what they should use.
“But I think the most important thing to interrogate is the country’s policy on software in general. If your country doesn’t have a specific policy with regard to software, then automatically interrogating the district will just be an effort in futility.”
He emphasised that there has to be a national software policy in different domains, especially for banking. “In the banking system, there is no specific interrogation or software issues.
Don’t forget that it is not National Office of Technology Acquisition that gives approval for software acquisition for major banks and other industries.
“They will apply that they want to buy this software, and that’s where the foreign exchange issue comes in and they are going to buy extra and once they approve it, then automatically, they get that acquisition.
“For example, about 13 banks use core banking application from India. It is India that really controls what happens in the banking sector, because they have access to those data.
Then one other thing is about storage, storage of data. Most of those data that we are having in the banking industry are stored in the cloud, which means that, sometimes, when we do transaction, the transaction goes abroad and comes back into the country, which makes us, also the banks customers, pay more instead of using data centers that are operating in the country.
“So if there is a policy like that that you cannot warehouse your financial data or government data in foreign software in the cloud, then automatically, everybody will be compelled to ensure that their data is locally stored.
‘That makes an issue of bandwidth. Also, it means that the internal bandwidth, the broadband, need to be invested, which is what the Minister of Communication, Innovation and Digital Economy, Dr. Bosun Tijani, is trying to do.”
While emphasising the government policy, Uwaje noted that Nigeria lacked the required technology infrastructure for the banks to depend on local technology for their operations.
“Policy of government allows them to do what they are doing. Then automatically, sometimes you don’t even believe because they have some limitation of what they want to do. They are really encumbered.
“But I think your interrogation should really go into what really happened, because that will be the lessons learned for other banks, for other problems that will emerge in the future, and then people can learn to be able to mitigate future occurrence,” he said.
