The Bank of Mozambique recently issued two notices on cyber risks in which it introduces a series of requirements that are now mandatory for local credit institutions and financial companies to comply with.

Reacting to this measure, Ernst & Young (EY), an international auditing firm, considers that this is a set of requirements to which financial institutions must adjust their risk management policies and procedures in order to meet them.

Despite the inherent challenges, EY says that the implementation of these mandatory measures will provide opportunities for financial institutions to take a step forward and align themselves more conclusively with market best practices.

Yes, "at the end of the day we believe that it will be possible to greatly improve the user (customer) experience because in fact the minimization of fraud risks and maximization of what is the efficiency in the processing of transactions and in the due diligence process that is done by each institution on its customers, will in fact undergo substantial improvements and work in a more transparent and efficient way," explained Gonçalo Arroja, Manager of the financial sector at EY.

These warnings will be implemented in full from the end of September. Financial institutions are already running a set of processes and procedures to ensure compliance with these new guidelines.

According to Arroja, at a financial level, companies will have to invest in the allocation of resources in order to develop the necessary capacities to comply with the two notices.

However, "in the medium and long term there is also a possible benefit which is obviously the result of greater efficiency in handling customer transactions, and in identifying all the processes that prevent money laundering (...) all these processes when based on biometric data can be more automated, based on digital tools and can be capitalized on in greater efficiency, that is, cost savings on the part of financial institutions," he said.

The source also said that these warnings, especially the introduction of biometrics as a customer identification mechanism, will make the financial sector a little more transparent and more efficient.

"In this way even the increase in transparency will in fact make it possible to minimize the risk of money laundering in the country via the financial sector," he said, going on to clarify that "when we have a customer identification system that is focused on or based on biometric data, we are able in a more transparent, more efficient and more complete way, to guarantee that in fact the duties of customer identification are respected in their entirety, as required by notice number 10/2024.

He was speaking a few days ago at an event on the impact of the Bank of Mozambique's warnings on financial institutions. The event was organized by EY and was attended by managers from financial institutions.