The Risk Managers Association of Nigeria has recommended banks invest more in risk assessment technology in order to reduce the risks associated with digitization in the banking sector.
Mr. Magnus Nnoka, President of RIMAN, mentioned this at the association’s 20th annual international conference, where stakeholders discussed risk management in the digital world.
“The rise in digital assets and channels has resulted in emerging and evolving risk types, so we are seeing increased digitization of risk,” Nnoka added.
“Even as organizations strive for greater digitization, we can easily identify a few roadblocks along the way, including legacy information assets, organizational culture, data quality, a scarcity of required talent, and the complexity of organizational structure.”
Risk management experts would need to examine and reconfigure their mandates and duties in the digital era, as well as build a digitally-driven mentality and capacity to give faster, more forward-looking, and deeper insights in driving the new working environment, he noted.
“Furthermore, concerns have been raised, not by a few, that technological innovation or digitalization specifically in the banking sector appears to be concentrated mostly on customer-facing journeys like online banking and marketing, as well as the activities that support these journeys like customer onboarding, customer servicing, and complaint resolution,” Nnoka said.
“I believe that risk management in the digital era should be supported by adequate and appropriate investment in risk management digitalization. Organizations should approach digital risk changes with purpose. It will become increasingly difficult for risk management to remain analog as customer-facing activities and processes move into the digital realm.”
In his keynote lecture, Mr. Adesola Adeduntan, Managing Director of First Bank of Nigeria Limited, said risk managers should be well-equipped to properly handle growing risks in a digital world.
“Given that digital technology has become an integral part of most businesses, especially financial services businesses, risk leaders will need to be well equipped to better manage the emerging risks in the digital era,” Adeduntan, who was represented by Mr. Ini Ebong, Group Executive Treasury and International Banking Group of FirstBank, said.
“Risk leaders are expected to provide the necessary support for their organizations to remain resilient in the face of increasing complexities in their operating and business environments.”