BY ELLENI ARAYA, AddisFortune

Without much deviation from its draft state, the long awaited directive that will allow banks and Micro Financial Institutions (MFI) to provide transaction-based mobile and agent banking services was issued, on January 1, 2013.

Now clients of banks and MFI’s, offering mobile banking services, will be able to make deposits and withdrawals through their mobile phones. They can also make payments to businesses or transfer money to clients using their mobile phones.

In previous years, the NBE had turned down requests from banks to launch transaction based mobile banking, stating it needed to issue this regulatory directive.

Instead those that had the technology were limited to providing clients with mobile services, such as; book transfers, viewing balance, mini-statements, notifications and alerts, on their phones. United, Zemen and Brehan banks were among those that offered such services.

Since these features were non-transaction based, the National Bank frowned upon calling the service ‘mobile banking’.

This led many banks, who had already acquired the technology to provide mobile banking, either along with their Centralised Online Realtime and Efficient (CORE) banking solutions or separately, in anticipation of the issuance of the directive.

As were mobile banking technology vendors, who had already set up shop inEthiopia, including Ireland-based M-Birr, which has signed a memorandum of understanding with ethio telecom, through its local branch. Bell Cash, an Irish company, is also in the process of setting up mobile banking with Bunna, Lion International, Oromia Cooperative and Wegagen banks.

Regulating this new system and building the capacity to regulate capital has taken time, according to National Bank officials.

The kind of mobile banking offered inEthiopiais one which makes use of agents that provide mobile banking services on behalf of mobile banking institutions. These services include; opening regular savings accounts for clients and performing ‘cash in cash out’ payments and transfer of funds, on behalf of the bank.

A client will have a ‘mobile account’ into which money is credited or debited, when using mobile banking services, according to the draft directive. The maximum balance that should be available in a mobile account, of an individual, is limited to 25,000 Br, and daily mobile banking transactions shall not exceed 6,000 Br, according to the directive.

This provision was, at one point, taken out of the draft directive, after some banks suggested that the limits should be raised to 30,000 Br and 10,000 Br, for balance and transactions respectively, according to a management team from one of the private banks.

However, the National Bank stuck to its original limits in the end.

The directive also places heavy responsibility on banks to make sure that agents comply with existing bank laws, including the ‘prevention and suppression of money laundering and financing of terrorism proclamation’ and ‘customers due diligence of banks’ directive.

Five banks, that Fortune talked to, have expressed pleasure at the issuance of the directive. They see it a great opportunity to reach ‘un-banked’ communities, in rural areas, and increase their deposit mobilisation.

The total amount of branches, from all fifteen banks existing in the country, is only 1,251, according to 2011/12 data.

“This is a meagre number when compared to neighbouringKenya, where the mobile service provider MPESA alone has 25,000 branches,” Berhanu Getaneh, president of both United Bank and the Bankers Association told Fortune. “The directive would bring an immense contribution towards increasing the number of people with access to banking services.”

Banks planning to provide mobile banking should first apply to the NBE, according to the directive. The application documents should include a detailed business plan, operational policy and procedure manual, and a risk management policy. The agents that the bank will use, and the type of agreement it will enter into, should also be clearly stated.

If the NBE approves the application, then the bank can start a pilot run that is limited to a specific area.

“It could start out with the main branch or use its own employees to test the system first,” Solomon Desta, Banking Supervision Directorate director, said.

Only after 2 to 3 months of pilot testing, and prevision a detailed report to the National Bank, could the bank launch full mobile banking services. This is if NBE allows the continuation of mobile banking services based on the results of the pilot project.

Banks that previously applied for mobile banking solutions would have to reapply accordingly, according to Solomon.

Already, interested banks are putting their minds to selecting appropriate agents.

“Supermarkets, gas stations and chain businesses are especially ideal to perform agency services for mobile banking,” Dagnachew Gessese, business development manager at Addis Bank told Fortune.

Views: 376

Tags: At, Banking, Ethiopia, Last, Legal, Mobile

Comment

You need to be a member of Sodere Ethiopian News and Entertainment to add comments!

Join Sodere Ethiopian News and Entertainment

SodereTube Ethiopian News

Is it true that Artist Gedion Daniel is "living on the streets","addicted to drugs"? Seifu Fantahun

Is it true that Artist Gedion Daniel is "living on the streets","addicted to drugs"? Seifu Fantahun

Most viewed video today - Who needs traffic lights? Not the drivers in Ethiopia [Meskel square]

Most viewed video today - Who needs traffic lights? Not the drivers in Ethiopia [Meskel square]

Haile Selassie signs New Constitution - Ethiopia's New Deal (1955)

GS. Emperor's coach arriving at House of Parliament in Addis Ababa, & SCU. CU. Soldier in traditional uniform. CU. Emperor and Empress of Ethiopia, Haile Selassie and wife, walking up steps past camera. SCU. Ethiopian dignitaries waiting. CU. Emperor of Ethiopia, Haile Selassie, sitting down and signs a document - New Constitution. Freedom of speech and universal suffrage are just some of the rights guaranteed to Ethiopians by this document. CU. Emperor's hand signing. SCU. Emperor sitting at table finishing signing CU. Dignitaries, two women among them. CU. Sealing of document, & CU. GV. Exterior, House of Parliament with "Big Ben style" tower. CU. Emperor and Empress on balcony acknowledging crowd. SCU. Ethiopians clapping and beating drums. CU. Crowd. CU. Drum being beaten. CU. Candelabra on banqueting table. GS. Banquet. SCU. Empress at table flanked by dignitaries. SCU. Gentleman and lady. CU Empress talking to son at table. SCU. Dignitaries at table. CU. Emperor at table. SCU. Table. SCU. Emperor eating. CU. Canopy over throne - pan down to Emperor and Empress standing. CU. Emperor's son and daughter-in-law dancing. CU. Emperor and Empress standing.

Seifu Fantahun Show Interview With Meseret Defar 2014

Seifu Fantahun Show Interview With Meseret Defar 2014

Jossy In Z House Show Celebrates Fasika With Manalemosh Dibos Children 2014

Jossy In Z House Show Celebrates Fasika With Manalemosh Dibos Children 2014

SodereTube Comedy

Funny Ethiopian celebrity imitator [Comment below whether this video plays better on PC/ Phone]

Funny Ethiopian celebrity imitator [Comment below whether this video plays better on PC/ Phone]

[Part 4] Classic #Ethiopia|n Holiday Comedy Drama "Yeshefe Tebasa" የሽፌ ጠባሳ ክፍል 4

[Part 4] Classic #Ethiopia|n Holiday Comedy Drama "Yeshefe Tebasa" የሽፌ ጠባሳ ክፍል 4

[Part 3] Classic Holiday Comedy Drama "Yeshefe Tebasa"

[Part 3] Classic Holiday Comedy Drama "Yeshefe Tebasa"

[Part 2] Classic Holiday Drama "Yeshefe Tebasa"

[Part 2] Classic Holiday Drama "Yeshefe Tebasa"

[Part 1] Classic Holiday Drama "Yeshefe Tebasa"

[Part 1] Classic Holiday Drama "Yeshefe Tebasa"

Events

SodereTube Sport

Haileyesus Melkamu: Ethiopian Messi?

Haileyesus Melkamu: Ethiopian Messi?

Ethiopian premier league supporters entertaining interview - Ethio League April 19, 2014

Ethiopian premier league supporters entertaining interview - Ethio League April 19, 2014

Ethiopia Sport News April 16, 2013

Ethiopia Sport News April 16, 2013

Ethiopia Football federation ends Negotiations with Goran Stivanovich

Ethiopia Football federation ends Negotiations with Goran Stivanovich

Sport News April 13, 2014 ስፖርት ቀን 7 ሰአት ዜና ሚያዝያ 05. 2006 ዓ.ም

Sport News April 13, 2014 ስፖርት ቀን 7 ሰአት ዜና ሚያዝያ 05. 2006 ዓ.ም

የ ፌስቡክ ጓደኛዎን ወይም ከኢሜይሎ አድራሻ ዝርዝር ወደ ሶደሬ.ኮም ይጋብዙ። You can now invite your Facebook friends and people in your address book to Sodere. It takes less than a minute. http://sodere.com/main/invitation/new

EthiopianTube Music

Belay Melesea - QibeChilign (ቅበጭልኝ) New Hot Ethiopian Music 2014

Belay Melesea - QibeChilign (ቅበጭልኝ) New Hot Ethiopian Music 2014

Amazing Talent. Man sings Maritu Legesse and Aster Aweke songs.

Amazing Talent. Man sings Maritu Legesse and Aster Aweke songs.

Assefa Mamo - Bel Engedi (በል እንግዲ) New Hot Ethiopian Music 2014

Assefa Mamo - Bel Engedi (በል እንግዲ) New Hot Ethiopian Music 2014

Ethiopian kid born in USA dancing guragigna

Ethiopian kid born in USA dancing guragigna

Nati Haile - Alteyekatm Zerwan (አልጠይቃትም ዘሯን) New Hot Ethiopian Music 2014

Nati Haile - Alteyekatm Zerwan (አልጠይቃትም ዘሯን) New Hot Ethiopian Music 2014

Ethiopian Videos

[Funny] Love Clinic April 22, 2014

[Funny] Love Clinic April 22, 2014

Ethiopian women chosen "best for relationship and love"

Ethiopian women chosen "best for relationship and love"

Jossy In Z House Show Celebrates Fasika With Manalemosh Dibos Children 2014

Jossy In Z House Show Celebrates Fasika With Manalemosh Dibos Children 2014

Funny Poem Getnet Eneyew

Funny Poem Getnet Eneyew

The Lost Kingdoms of ETHIOPIA Best Doumentary of BBC [YouTube Video: sodere.com/video]

የከሰሙት ታላላቅ የኢትዮጵያ ግዛተ ነገስታት ይህን በBBC የተዘጋጀዉ ድንቅ ዶክሜንተሪ ፊልም ይመልከቱና ይደሰቱበት ይደነቁበት

Ethiopian news and video portal. Sign in create profile, share videos, upload picture, invite your friends and have fun.

Ethiopian shows

Love Clinic April 22, 2014

Love Clinic April 22, 2014

Addis Ababa in 1958

Addis Ababa in 1958

Jossy In Z House Show Celebrates Fasika With Manalemosh Dibos Children 2014

Jossy In Z House Show Celebrates Fasika With Manalemosh Dibos Children 2014

Congratulation for Ethiopian Ladies

Congratulation for Ethiopian Ladies

Do married or single people have less heart problems? Find out.

Do married or single people have less heart problems? Find out.

Comedy

Funny Ethiopian celebrity imitator [Comment below whether this video plays better on PC/ Phone]

Funny Ethiopian celebrity imitator [Comment below whether this video plays better on PC/ Phone]

Very funny Easter interview with comedian Filfilu (Bereket Bekele)

Very funny Easter interview with comedian Filfilu (Bereket Bekele)

Kibebew Geda musical comedy - Easter special program

Kibebew Geda musical comedy - Easter special program

Betoch Comedy Part 57

Betoch Comedy Part 57

All Idol Shows (Balageru, Coca cola...)

Amazing talented girl dance wins the attention of judges and audience

Amazing talented girl dance wins the attention of judges and audience

Eyerus Belay sings Tewodros Tadesse song - Balageru Idol

Eyerus Belay sings Tewodros Tadesse song - Balageru Idol

Chalachew Gebre-Tsadik - Oromiffa with Ambasel Melody

Chalachew Gebre-Tsadik - Oromiffa with Ambasel Melody

Balageru Idol - Best Five Modern Dance Group

Balageru Idol - Best Five Modern Dance Group

Best performance of the day - Balageru Idol March 22, 2014

Best performance of the day - Balageru Idol March 22, 2014

© 2014   Created by Sodere.

Badges  |  Report an Issue  |  Terms of Service