Bank robbers rarely come in through the bank’s physical doors, this was a chilling warning from Professor Olanyika David-West, a presenter during the Tanzania’s Conference of Financial Institutions (COFI), an annual event that gathers top executives from Tanzania’s financial sector.
The conference was held in Arusha on March 7 and 8, 2024 at the Arusha International Conference Centre under the theme Strengthening Financial Sector Resilience in Challenging Economic Times.
“The smart thief is already in, through the cables,” underscores Professor Olanyika, an information systems expert who serves as the Associate Dean of the Lagos Business School (LBS).
Olanyika’s warning came at the right time after the recent circular from the Bank of Tanzania revealed losses caused by fraud on mobile and internet banking including cyber-attacks.
The BoT’s circular shows a total of 4. 89 billion Tanzanian Shillings were stolen through mobile and internet banking and Sh. 741 million losses were incurred through ATM Card skimming. These numbers shows cyber threats is a serious risk to the Tanzanian banks.
With the growing digitization of the financial sector, cyber threats are emerging as a critical banking risk globally, experts warn that if a major cyber-attack is not properly contained it could trigger a global financial crisis.
The World Bank report titled Cyber Threats to the Financial Sector in Africa shows that African financial- institutions face significant threats from organized criminal groups and financially motivated nation-states that conduct high-value thefts in heist-style operations.
The report also notes that Africa’s financial systems are also heavily affected by a large volume of low-sophistication scams, thefts, and fraudulent activity directed against their customers.
Risk Mitigation
Experts argue that preparation is key to handling these cyber threats, Dr. Muhsin Salim Masoud who is the Managing Director (MD) of People’s Bank of Zanzibar (PBZ) and former MD of Amana Bank shared his journey in preparing for cyber threats.
“There are disaster recovery sites in the banking sector, these sites ensure that you can continue with business as usual if anything goes wrong. In one of the banks that I led, we discussed with the management whether we should go to the cloud or not, the proposal was only supported by the head of ICT and myself,” said Masoud.
“But believe me, it helped a lot during the time of the crisis, because we had a cyber-attack. I can not mention it was on which bank that I led, but [the cloud] helped us a lot. We could continue with the operation and in the evening other services were restored.”
Investment in the capacity of the staff is something that was also emphasized during the conference, this is the capacity of experts but also the capacity of all staff in the bank.
“While we are connecting, we need to think about how we can build our human firewalls,” argued Professor Olanyika, “Because it is no longer about systems firewalls, it is also about building a human firewall. We are also a risk, we can get malware, we can bring ransomware into the organization’s systems.”
