The Bank of Ghana’s success in SupTech (Supervisory Technology) has proved groundbreaking, shedding light on the multifaceted advantages and hurdles inherent in adopting technological solutions for financial oversight.
The Second Deputy Governor, Bank of Ghana, Mrs. Elsie Addo Awadzi highlighted these insights in her keynote address during the inaugural 2023 Cambridge Suptech Week.
The Bank’s journey was underscored by implementation of the Online Regulatory Analytic Surveillance System (ORASS) from 2019 to 2022. ORASS, designed to bolster the effectiveness of financial supervision, encompass diverse modules and enable comprehensive supervisory functionalities.
Mrs. Awadzi highlighted the transformative impact of ORASS by stating: “It has provided a single portal that consolidates prudential data from regulated institutions, streamlines reporting templates, eliminates data silos and aids operational, analytical and policy decisions”.
Despite its success, the ORASS implementation journey revealed pivotal lessons crucial for future ventures into Suptech adoption. Mrs. Awadzi emphasised several key takeaways, including the need for aligned implementation timelines with the readiness of regulated institutions. She noted: “Timelines should reflect institutions’ capacities to migrate to new systems; overestimation of readiness poses challenges”.
Moreover, granular-level data collection presents challenges due to lacking baseline data, requiring interim steps for institutions to update customer profiles before system commencement. Cybersecurity risks surge with system implementation, compelling the establishment of a Financial Industry Command Security Operations Centre (FICSOC) to fortify cyber-resilience across the industry.
Cost implications emerge as a significant consideration, with acquisition costs potentially proving prohibitive. Mrs. Awadzi advocated for sequencing module adoption to optimise efficiency gains and promote local expertise utilisation to mitigate expenses.
The collaboration with Cambridge Suptech Lab to develop a consumer protection Suptech tool demonstrates the Bank’s commitment to complementing ORASS, enabling an integrated prudential and consumer protection view of supervised entities. Mrs. Awadzi expressed gratitude for this collaboration, citing its role in the Bank’s continuous journey toward bolstered effectiveness.
Throughout this journey, the Bank prioritised capacity building and technology transfer – ensuring maximum knowledge-exchange with the vendor to facilitate local post-implementation support. However, Mrs. Awadzi stressed that even with well-designed Suptech, effective supervisory judgment remains indispensable; necessitating ongoing investments in supervisor capacity building.
The ORASS initiative not only streamlines supervisory functions but also extends support to monetary policy operations and foreign exchange market surveillance. The system’s ability to collect granular-level data enables a comprehensive understanding of banking services usage, facilitating interventions to promote financial inclusion.
In conclusion, the Bank of Ghana’s ORASS initiative stands as a testament to the transformative potential of Suptech in financial supervision. Its successes and challenges serve as guideposts for supervisory authorities globally, promoting international peer-learning and collaboration in navigating the evolving landscape of financial technology and oversight.
