By Ayomide Otitoju
Guaranty Trust Bank (GTBank), one of Nigeria’s leading tier-1 banks, has obtained a Federal High Court order to recover ₦1.9 billion erroneously credited to customer accounts during a system migration in late October 2024.
The mishap occurred between October 28 and 29, when the bank transitioned its core banking platform from Basis to Finacle. The error stemmed from duplicate transactions while processing unapplied inflows from the NIBSS Instant Payment (NIP) system, according to findings by Kade Communication NG.
Upon identifying the mistake, GTBank initiated an internal investigation, discovering that some of the duplicate funds had been transferred to accounts at other financial institutions. To recover the funds, the bank approached the Federal High Court in Lagos, requesting account restrictions for recipients of the erroneous transactions.
Justice F.N. Ogazi granted the order on Thursday, authorizing GTBank to impose restrictions on the affected accounts and paving the way for the recovery of the misplaced funds. The court’s directive has been served to the receiving banks.
System Migration Challenges
The incident came amid widespread service disruptions following GTBank’s switch to Finacle in September 2024. Developed by Infosys, Finacle is a leading core banking application in Nigeria’s financial sector. GTBank executives reportedly visited India as part of the decision-making process for the migration.
The migration, aimed at improving operational efficiency and enhancing customer experience, faced significant technical challenges. Following the October completion announcement, customers reported widespread issues, including erroneous transaction alerts and persistent service instability.
While the duplicate transaction error has not been explicitly linked to the migration, similar technology challenges were a recurring issue in Nigeria’s banking industry throughout 2024. At least four commercial banks experienced customer disruptions during core banking software upgrades.
The wave of migration-induced disruptions prompted the Central Bank of Nigeria (CBN) to issue a directive requiring prior regulatory approval for system upgrades.
GTBank’s latest recovery effort underscores the complexities and risks associated with large-scale technology transitions in the banking sector. The incident has also reignited discussions about the importance of robust risk management during such transitions.
