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Eth-Switch to Begin Pilot Trial

The much anticipated Eth-Switch, which is expected to centralize all banks’ online real-time and electronic (CORE) banking solutions, is to commence its pilot project on May 28, 2015.

Banks such as Oromia International Bank S.C (OIB) have been working with us, Bizuneh Bekele, CEO of Eth-Switch told Fortune, but declined to name any of other banks that are engaged in the actual process of integrating their system with Eth-Switch.

The project will have two phases: the first phase is the one that will be launched as a pilot project which is mainly bringing inter-operability and second phase will focus on introducing and expanding services, added Bizunhe. It is expected to introduce more than 40 services.

The first phase will mostly focus on launching basic services that will facilitate inter-operability among banks, a total of eight services including automated teller machines (ATM) and Points of Sales (PoS). These include cash withdrawal and balance check, which could be done on ATM, as well as purchasing, reversing and refunding services, enabled through PoS.

While on the second phase, different kinds of money transfer services will be integrated, such as mobile and internet banking system.

Eth-Switch was established in 2011 by 16 banks with 80.5 million Br following the recommendation by National Bank of Ethiopia, on June 2009. The technology, which is expected to be connected to the National Payment System (NPS) operates under National Bank of Ethiopia (NBE). It will enable clearing of cheques and using the ATM of any bank and use PoS.

OIB has invested 25 million Br for purchasing 30 ATMs and will directly interface its CORE banking with Eth-Switch software and PoS.

OIB, which was established in October 2008, had decided to procure 30 of its Hungary made NCR ATM’s from Moti Engineering Plc. As per the award, Moti has already delivered 10 of the ATMs last year. Moti had won the award after bidding with a company called CBM, which offers Diebold ATM’s.

These ATM’s will be incorporated with Eth-Switch, which is expected to commence electronic transaction service on May, 2015, said Geleta Beakuma, E-banking manager at OIB. We are working to launch the service at the aforementioned month.

The first batch of 10 ATMs, which have already been bought from Moti, are in the phase of testing and preparation, said Belay Bayisa, marketing and public relations manger at OIB.

As of now, Moti has supplied 650 ATMs for the Commercial Bank of Ethiopia (CBE), 70 for Wegagen Bank, 70 for Dashen Bank, 59 for Zemen Bank, 10 for Abay International Bank (AIB) and four for Berhan International Bank S.C. It also recently supplied 25 ATMs to the Corporative Bank of Oromia (CBO) and 50 ATM to Nib international Bank (NIB).

OIB is also in the process of acquiring ATM cards soon. “We are planning to announce a new bid for a purchase of 50,000 ATM cards from suppliers in the coming weeks,” added Geleta.

Moreover, the bank has announced that it is to launch internet banking, which will give access to customers to transfer money from their account, to follow up issues of loans from the bank and to request Letters of Credit (LC) and issue cheques.

According to OIB’s 2013/14 annual report, it registered profits 154.3 million Br, exceeding the previous year’s performance of 78.1 million Br. The bank has also increased earnings per share to 310 Br from 192 Br in the preceding year. And as of June 30, 2014, the Bank has 106 branches, having expanded on the previous number by 41. Thirty-one of the newly opened branches are located in Addis Abeba while the remaining branches are outside of the capital.

Aside from OIB, the management of Bunna International Bank S.C. (BIB) is discussing how the bank could integrate its CORE banking system with Eth-Switch.

“It is too early to comment on the progress of our bank in the matter,” said Welelaw Berihane, Director of Information systems at BIB. “We are aware that Eth-Switch will commence the pilot project at the end of May, 2015,” added Welelaw.

The pilot project is expected to be finalised within two to three month’s time, said Bizunhe.

Tags: Dashen Bank,, National Bank of Ethiopia (NBE),, Eth Switch S.C Ethiopia,, Moti Engineering PLC,, Automated Teller Machine (ATM) in Ethiopia,, Oromia International Bank (OIB),, Bunna International Bank (BIB),, Corporative Bank of Oromia (CBO),, Nib International Bank (NIB),

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