Dashen Set to Pioneer Agent Banking in Ethiopia

Dashen Bank S.C will introduce agent banking by December 2014, becoming the first bank in Ethiopia to do so.

The Central Bank licensed it in August 2014, following the issuance of the Regulation of Mobile & Agent Banking Services directive in 2012. Agent banking is, according to the directive – “the conduct of banking business on behalf of a financial institution through an agent using various service delivery channels, other than the Bank’s own tellers or cashiers”.

Dashen has received a license for cash deposits, payment and card systems, excluding loan services, said Chaneyalew Demissie, E-Banking services manager.

“Currently, the Bank is dealing with agents,” he said.

Such services are 50pc cheaper than opening a branch. They also enable the bank to reach people without access to Banks, says Estifanos Befekadu, head of the Promotion Division at the Bank.

Dashen has hired mFino – a California-based mobile financial services software company, which has been working for the last three weeks – to customise the system, according to Chaneyalew.

Dashen, which has 1.2 million account holders, 179 Automated Teller Machines (ATMs) and 959 Point of Sales (PoS), along with five additional Forex ATMs, will work with mFino for the next five years, but bank officials decline to disclose the amount they paid to mFino.

“We will finalise the installation and start the soft launch by the beginning of December with the four agents we are dealing with,” said Chaneyalew, also declining to identify the four agents, although he says Dashen will increase their number to 20.

Agents, according to NBE’s directive, could be such businesses as supermarkets, shops and fuel stations.

“The Bank is selecting agents that can come up with a business license, financial audit and clearance from police showing that they have no cases pending at court,” said Chaneyalew.

Dashen has 135 branches, 18 billion Br in total deposits, 22 billion Br in assets and 1.1 billion Br in paid up capital, as of 2013/14. It says it will launch American Express cards after two weeks, in addition to the existing MasterCard, VISA and UnionPay.

Dashen’s annual profit was close to one billion Br during the last fiscal year, growing from 607 million Br in 2012/13 and 652 million Br in 2011/12. The Bank has recently announced salary increases to all its 3,690 employees, ranging from 76pc to 129pc, which cost the Bank 120 million Br.

The Bank will pay commissions to the agents it is preparing to work with based on the transaction they made, according to Chaneyalew.


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