[OR] [MBT] [E3] [CBS] [10] [SuPS] Identify Severe but Plausible Scenarios

Sub-CBS Code

Sub-CBS

Severe but Plausible Scenario

Impact/Effect

Proactive Risk Management Action

Link to Integration of Cyber and ICT Risks

10.1

International Remittance Processing

Large-scale denial of service attack on the remittance platform

Disruption to international remittance processing, leading to financial losses and customer dissatisfaction

Implement multi-layered DDoS protection, backup servers, and continuous monitoring of transaction systems.

Integration with cyber risk management tools and incident response plans, ensuring quick recovery and resilience against cyber threats.

10.2

Remittance Partner and Correspondent Bank Management

Sudden insolvency or operational failure of a key correspondent bank

Significant delays or inability to process transactions, affecting customer satisfaction and compliance

Establish contingency agreements with alternative partners, and ensure multi-currency support across various banks.

Regular testing of financial service integrations, monitoring of third-party risks, and business continuity planning with partner institutions.

10.3

FX Conversion and Rate Management

Extreme market volatility is causing FX rates to fluctuate beyond operational limits

Losses from unhedged currency positions and potential compliance issues with currency laws

Regular hedging strategies, stress-testing of FX models, and use of automated real-time rate monitoring tools.

Integration with real-time financial systems and cyber risk assessments for market manipulation or data breaches affecting FX operations.

10.4

OFW Remittance Facilitation

Political instability in key remittance source countries is impacting service channels

Major disruption to the inflow of remittances, leading to service interruptions and regulatory fines

Diversify remittance channels and corridors, engage with regulators to ensure compliance, and ensure system flexibility.

Cybersecurity protocols around cross-border remittance systems, ensuring compliance with international sanctions and cybersecurity regulations.

10.5

Cross-Border Compliance and Sanctions Screening

Data breach of customer information leading to compromised compliance data

Breach of customer trust, possible fines from regulators, and delays in processing due to investigations

Encrypt customer data, perform regular cybersecurity audits, and enhance user authentication protocols.

Integration of automated compliance monitoring tools that flag suspicious transactions, integrating with ICT security protocols.

10.6

Customer Enrolment and KYC for Remittance Services

Regulatory changes requiring immediate updates to KYC requirements

Delays in customer onboarding, potential loss of business due to compliance gaps

Proactively monitor regulatory changes, implement adaptive KYC platforms, and ensure staff training on new compliance laws.

Cyber and ICT risk integration to ensure that KYC processes are protected from fraud, including penetration testing and biometric authentication integration.

10.7

Dispute Resolution and Trace Requests

Surge in disputes due to a security vulnerability leading to unauthorised transactions

Backlog of unresolved cases, damaged reputation, and loss of customer trust

Implement advanced fraud detection algorithms, and invest in AI-powered customer service chatbots to handle disputes quickly.

Cyber risk assessments and response protocols, ensuring trace requests are handled efficiently with no risk of further fraud.

10.8

FX Transaction Settlement and Reporting

Settlement system failure due to infrastructure overload or a system bug

Major delays in settlements, regulatory reporting issues, and financial exposure

Test system scalability, implement redundancy protocols, and have dedicated teams for real-time issue resolution.

Integration with ICT systems to detect and prevent system overloads, with proactive patches and real-time monitoring for system health.