GT Bank (Guaranty Trust Bank) is one of the largest and most prominent banks in Nigeria. Established in 1990, GT Bank offers a wide range of financial services, including retail banking, corporate banking, and investment services. It is known for its innovative banking solutions, cutting-edge technology, and efficient customer service. Over the years, GT Bank has established itself as a key player in the Nigerian banking industry, with a significant market share.
The History of GT Bank: A Story of Innovation and Growth
GT Bank was established in 1990, with the aim of providing quality banking services to Nigerians. The journey began with a vision to create a customer-first bank, one that would revolutionize the Nigerian banking experience. Fast forward to today, GT Bank is a global leader in retail banking, known for its innovative solutions and exceptional customer service.
From the outset, GT Bank prioritized technological advancements, which would later become its hallmark. In the early years, the bank introduced modern banking methods, moving away from traditional, paper-based systems, to more efficient, computerized ones. This early adoption of technology set GT Bank apart, allowing it to expand quickly across the country and establish a loyal customer base.
Why Are Banks Upgrading Their Systems?
The core banking application is the central backend system responsible for processing daily transactions and managing accounts and financial records. According to Rasheed Bolarinwa, head of the Association of Corporate and Marketing Communication Professionals in Nigerian Banks (ACAMB), some banks transition from one core banking application to another provided by the same software company, while others switch to a completely new provider.
Recent migrations include GTB’s move from ICS Financial Services in the UK to EdgeVerve Systems’ Finacle in India, and Sterling Bank’s shift from Temenos T24 in Switzerland to SeaBaaS, a locally-developed core banking system by Peerless.
During these migrations, technical glitches are common, causing disruptions for many Nigerian bank customers. In early September, Sterling Bank clients experienced issues with the bank’s mobile app, which was down for nearly two weeks. On October 1, Zenith Bank’s customers reported similar problems, unable to access their mobile app after a system update. Despite the bank’s assurances that the process would take only three hours, users faced login issues for about 72 hours.
Likewise, First Bank’s customers couldn’t perform transactions on the bank’s digital services for six days due to system upgrades. Zenith Bank’s troubles lasted three days, while Access Bank and GTB announced upcoming system updates on October 9. Access Bank delayed its upgrade to October 12, while GTB stated its online banking services would be down for 11 hours starting October 13.
Sterling Bank’s CEO, Abubakar Suleiman, shared that, prior to Q3 2024, all Nigerian banks relied on foreign-based core banking systems, which required significant maintenance costs. By switching to SeaBaaS, Sterling Bank has reduced expenses related to financial inclusion and local technology costs. Suleiman explained that many African banks spend hundreds of millions annually on foreign systems, which worsens the continent’s trade balance.
He added, “By successfully implementing this new core banking system, we are setting a new standard for Nigerian financial services and paving the way for African institutions to localize their technology costs, ultimately reducing financial inclusion expenses.”
However, Bolarinwa clarified that banks are willing to invest in high-quality service for their customers, so these upgrades aren’t driven solely by cost concerns. Instead, they can represent major updates to core banking applications or regular system maintenance.
Bolarinwa also pointed out that disruptions may occur at colocation facilities, where third-party vendors host servers, storage, and networking infrastructure. Factors like power issues, personnel shortages, natural disasters, and connectivity failures—such as the recent underwater cable outages across Africa—can lead to service interruptions.
Is the System Upgrade a Directive from the CBN?
A bank official, who wished to remain anonymous, clarified that the Central Bank of Nigeria (CBN) does not mandate banks to update their systems.
“The decision to upgrade is entirely up to the individual bank. While the CBN doesn’t need to approve these upgrades, banks are free to inform the CBN about them,” the source explained.
The official added that the CBN’s goal is for all banks to succeed, and upgrades are typically scheduled during off-peak hours when transaction volumes are lower. “Nigerian banks are known for continuously investing in such upgrades, despite the high costs, as part of their operational processes,” the source said.
Rasheed Bolarinwa also pointed out that the CBN is not directly involved in these upgrades. He explained that while banks strive to innovate and improve their services, system updates often happen coincidentally. “No bank notifies others about platform or system maintenance,” he said. “Nigerian banks are leading the way in sub-Saharan Africa and beyond, driven by a culture of innovation and progress.”
Are Funds Safe During the System Upgrade?
A spokesperson for a bank assured customers that their funds would remain secure during system upgrades.
“Your money in a bank will never vanish. It is protected due to the strict regulations governing the sector,” the spokesperson emphasized. “The Nigeria Deposit Insurance Corporation (NDIC), the Securities and Exchange Commission (SEC), and the CBN all oversee the banking industry, ensuring multiple layers of security and professional oversight.”
GT Bank’s Future: A Vision of Continued Innovation
As we look toward the future, GT Bank remains committed to maintaining its position as a leader in the financial sector. The bank has big plans for expanding its digital services, further improving the customer experience, and increasing its reach across the globe.
Frequently Asked Questions
Why are Nigerian banks, including GT Bank, upgrading their systems?
Nigerian banks are upgrading their systems to modernize their core banking applications, enhance security, improve customer experience, and reduce reliance on costly foreign technology. These upgrades also aim to streamline operations, boost efficiency, and position the banks as leaders in technological innovation across Africa.
Is the Central Bank of Nigeria (CBN) requiring banks to upgrade their systems?
No, the CBN does not mandate system upgrades. Banks choose to upgrade their systems based on their needs and internal strategies. While the CBN does not approve or require these upgrades, banks are free to inform the central bank about any changes.
How do system upgrades affect customer services?
During system upgrades, customers may experience temporary disruptions in banking services, such as difficulties accessing mobile apps or completing transactions. However, these upgrades are typically carried out during off-peak hours to minimize the impact, and the goal is to enhance long-term service quality and security.
Are customers’ funds safe during the system upgrade?
Yes, customer funds remain secure during the system upgrade process. Banks are strictly regulated by bodies like the Nigeria Deposit Insurance Corporation (NDIC), the Securities and Exchange Commission (SEC), and the CBN, ensuring that there are multiple layers of protection in place for customer deposits.
How often do Nigerian banks upgrade their systems?
Nigerian banks frequently upgrade their systems as part of regular maintenance and technological advancements. While some upgrades are planned, others may occur unexpectedly as banks work to stay ahead of industry trends, ensure the security of customer data, and enhance operational efficiency.
Conclusion
The simultaneous system upgrades across Nigerian banks, including major institutions like GT Bank, reflect the industry’s drive for innovation, enhanced security, and improved customer service. While these upgrades are not mandated by the Central Bank of Nigeria (CBN), they are part of each bank’s ongoing efforts to maintain competitive advantage and operational efficiency. The decision to upgrade is often driven by the need for modernized core banking applications, better financial inclusion, and the reduction of reliance on expensive foreign technology.
Despite the inconvenience these upgrades may cause, particularly with service disruptions, they are essential for future-proofing the banking sector. The Nigerian banking industry is positioning itself as a leader in technological advancements across Africa, with banks continuously working towards optimizing their platforms, even at significant costs. Ultimately, these upgrades aim to ensure a seamless and secure banking experience for customers, aligning with regulatory oversight by bodies like the CBN, NDIC, and SEC, which safeguard customer funds throughout the process.
