Leading financial services providers across the continent are increasingly adopting locally-developed account reconciliation solutions to address persistent operational challenges, including the well known as ‘one-man risk’ – where critical operations become overly dependent on specific employees.
At the top of the pile is Clirec, developed by Lagos-based Precise Financial Systems (PFS), which automates complex reconciliation processes that have traditionally relied on skilled individual operators, often making these employees ‘untouchable’ within their organisations.
Speaking during a breakfast meeting organised by PFS and its partner, CWG, Philip Ayeni, Deputy Managing Director of PFS, explained how the phenomenon had led to crippling inefficiencies in many institutions. “You have a situation where people cannot go on leave, people cannot be transferred, in fact people cannot be sacked. At times people cannot be promoted because they are so good, so very key, they become a one-man risk,” he said.
The software has gained significant traction as banks grapple with increasing transaction volumes and regulatory scrutiny. “You have some banks that have thousands, tens of thousands of accounts they reconcile, which they have to do on a daily basis,” Mr. Ayeni elaborated.
With African financial institutions handling increasing transaction volumes, the need for automated reconciliation solutions has become critical, he added. To expand its reach across the continent, PFS has partnered with CWG, a move that aligns with a growing trend of intra-African technology collaboration. “There is a lot we can do to make one plus one more than three in Africa. There is a lot we can do to make our resources multiply within Africa and reside within Africa,” he noted.
The system handles various critical banking operations, including Nostro accounts, Vostro accounts, suspense accounts, e-business accounts, and ATM reconciliations. It introduces automated controls that standardize processes across banking operations, regardless of scale.
Mr. Ayeni stated that accounts reconciliation is a necessary procedure for all business concerns, although it is particularly prominent in financial institutions due to the substantial volume of transactions processed daily. A key feature of the solution is its ability to maintain consistent quality across operations while creating a reliable audit trail.
He underscored the significance of preserving transaction records for investigative purposes, including maintaining a comprehensive, 100 percent archive of working papers. The system also enforces segregation of duties, a crucial control measure in banking operations. “You do not have a single person responsible for reconciliation from the beginning to the end. The data input can be segregated from the matching to exercising of judgment,” Mr. Ayeni.
PFS, with its 30-year track record in the industry, has developed the solution to include sophisticated monitoring capabilities. “The supervisor does not need to even call you and say, Charlie, how far will you go? Because behind your back, he signs on to the system and check how far you have gone,” Ayeni notes.
The partnership between PFS and CWG represents a significant step in African technology collaboration. CWG, known for its extensive presence “in Africa and beyond,” brings established relationships with numerous Original Equipment Manufacturers (OEMs) to the partnership.
CWG Ghana’s Head of Project Management and Corporate Development, Oluwaseun Layade, speaking on behalf of Harriet Yartey, MD of CWG Ghana, noted that the system can process millions of transactions while maintaining consistent standards across operations. “If you have 1 million accounts and you have 100 million transactions, you are rest assured that there’s uniformity in the way reconciliation is carried out throughout the banks,” Mr. Layade stated.
He noted that the primary objective is to simplify and streamline account reconciliation, a significant challenge many organizations face, especially with manual or semi-automated processes.
“The Clirec account reconciliation solution offers a fully automated system built on advanced AI technology, designed to eliminate the complexity of traditional methods. Today, AI is at the forefront of innovation, and Clirec leverages this to provide our customers with an effortless account reconciliation experience.
One of the biggest vulnerabilities in financial processes is manual intervention, which can open the door to errors or fraud. By automating the entire system with AI, we drastically reduce the human footprint, minimizing opportunities for manipulation. While it is true that even automated systems can be exploited, Clirec’s AI-driven solution has been engineered with rigorous checks and balances, ensuring robust fraud detection and prevention. This provides our customers with a high level of security and confidence in their reconciliation processes,” he explained.
