Digital transformation and electronic payment technologies in the banking sector

by **claud39** Thu Feb 13, 2020 2:19 pm

[size=36][rtl]Digital transformation and electronic payment technologies in the banking sector[/rtl][/size]

Tuesday, February 11, 2020

Digital transformation and electronic payment technologies in the banking sector Alsabaah-30655

Samir Al-Nassery *

The large and accelerated development in modern banking technologies, systems, devices and programs has led to a wide range of development and change and transformations in the economy, labor market and productive sectors, as the digital transformation is one of the most important drivers and incentives for growth in government and private companies, and given that the banking sector is the main link in Economy Through its financing and investment role, the digital transformation in this sector has become an urgent necessity.

The concept of digital transformation

It is the transition of the governmental and private productive, financial, and banking sectors into a business model that relies on digital technologies to innovate services and products and provide new channels of revenue that increase the value of their products at low operational costs.

There are a number of requirements for the transition to digital transformation, the most important of which are:

1 - Building short and long term strategies that include studying the current reality of the government and private banking sector in terms of available technologies, available devices, customer information base, the bank's financial database and qualified human resources.

2- Infrastructure and means of information and communication security.

3- The strategic partnership between the central bank, government banks, private banks, electronic payment companies, financial technologies and service providers, according to the following:

* Working in a joint manner that includes the central bank, banks, and financial technology companies, through a specialized council or committee.

* Establishing an independent company in which government banks participate by 20 percent and the private sector 80 percent, and it includes e-payment companies, telecommunications companies, information technology companies, software development and electronic payment companies.

The challenges of digital transformation

Obstacles to the transition to digital transformation include the following:

1 - The risks of electronic operation

2‐ Access to the banking system and theft of electronic identity.

3- Credit Card Fraud.

4- Electronic piracy.

5- An imbalance in the comprehensiveness of the banking system or as a result of customer errors.

6 - Imitating computer programs or falsifying information identical to programs.

7 - Failure of banks or financial technology companies to abide by legal rules and regulations, or the absence of a law regulating digital transformation.

The Iraqi experience

With persistence and high confidence in the ability of the Iraqi financial and technical staff to overcome the challenges of the technical gap that Iraq suffered due to the repercussions of the blockade, wars and instability during the period of the information revolution, the central bank, banks and specialized technical companies were able to overcome the challenges that stood in the way of the digital transformation of the banking sector and stand in the right direction In the darkest economic and security conditions that our country has suffered during the past years and drawing a sound road map to catch up with technological developments in the countries of the world.

The follower of the situation of Iraq during the past five years notes the extent of belief in Iraqi capabilities and competencies to bring about change and bridge the technical gap between us and the developed world, and this is evident by what has been achieved of important accomplishments as follows:

1 - The methodology adopted by the Central Bank and implemented by banks and electronic payment companies permanently focuses on working under a sound legislative, regulatory and legal umbrella, as well as promoting governance concepts and international standards in relation to information technology and financial technologies.

2 - The issuance of the electronic payment system for funds No. 3 of 2014, the establishment of the National Payments Council, governance controls, institutional management of information and communication technology, regulations and legal instructions that govern the work of banks and electronic payment services providers.

3 - The Central Bank plays a pivotal role in creating advanced and pursuit infrastructure for the latest global technologies and developing the bank's financial and banking systems, payment systems and advanced communication networks according to the latest technologies.

4 - The central bank, banks and electronic payment companies possess advanced payment systems, in addition to retail payment structures, and the national divider was one of its most important parts.

5- Granting work licenses to many electronic payment services providers (card issuers, collectors, and processing the operations of mobile payment companies, bidders and payment gateways through various channels).

6- Broad interest in implementing the first objective of the bank's strategy for the years (2016-2020). It is achieving financial stability through a sound financial system with an interest in achieving financial inclusion and reducing risks, as well as adopting a project to localize employee salaries.

It is clear from the above achievements that the central bank, the banking sector and electronic payment companies have overcome the challenges of the technical gap due to the blockade, the occupation and terrorism, and today it is moving steadily to achieve the digital transformation in the financial and banking sector towards achieving financial stability and the transition from the monetary community to the critical community, which is also one of the objectives of the government curriculum On the fourth axis (strengthening the economy).

future plans

1 - Promote research and development activities to manufacture new banking products.

2 - Improving the performance of banks through new inputs based on modern technologies, as well as the development of patterns and policies that adopt modern banking techniques that preceded us in the developed world.

3- Building capacities and qualifying human resources in the field of modern banking sciences, technology and innovation in order to achieve the goals of sustainable development.

4 - Setting plans and programs aimed at transforming society into a society that deals with criticism into a society of criticism and an information society, so that economic and social development plans and strategies are produced while working to achieve the goals of sustainable development.

5 - Preparing national policies and strategies consistent with the monetary authority's plans in management, supervision and control, and in coordination with information and communications technology.

* Banking expert

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