Lion International Bank (LIB) S.C. will begin an agent and mobile banking system within two weeks, pending approval of the National Bank of Ethiopia (NBE).
This will put Lion in league with Commercial Bank of Ethiopia (CBE), Wegagen International Bank S.C. and United Bank S.C. who have already begun similar services. Others, such as Cooperative Bank of Oromia (CBO), Abay Bank and Dashen Bank S.C. have begun pilot programmes, according to information obtained from NBE.
The Bank has already concluded its test programme and submitted its report to NBE two weeks ago. It is waiting for the green light to commence operations, commented Getachew Solomon, president of LIB.
According to NBE regulations for mobile and agent banking services, it is expected to assess the pilot test report and give its approval within one month.
LIB carried out the pilot programme from February to May 2015, under a separate unit established to oversee the agent and mobile banking system.
The Bank has recruited 160 agents, 60 of which are located in Addis Abeba.
Agent and mobile banking systems are renowned for the expansion of financial inclusion among a society, said Getachew. Therefore, the pilot test has tried to include all parts of Ethiopia including Hawassa, Wolayita, Adama, Shashemene, Dila, Dire Dawa and Mekele, he added.
The cost effectiveness of the system in comparison to opening a branch, and the growing number of mobile subscribers are additional motives for the bank to embark on the service, explained Abreham Tilahun, manager of the Alternative Channel Banking Division of LIB.
Established on October 2, 2006, LIB currently has 90 branches across Ethiopia, with 36 of them located in the capital city, Addis Abeba.
The Bank has partnered with BelCash Ethiopia for the installation of mobile banking technology known as HelloCash tech platform. BelCash is owned by the Netherland’s BelCash International which provides technological solutions for financial services using the Internet and mobile phones, its website states.
BelCash Ethiopia will collect its payment through a revenue sharing principle from the transactions that will be made, commented CEO of BelCash Ethiopia, Vince Diop, though the percentage each partner will receive has not been disclosed.
In order to provide customers with mobile banking services and information on their account activity a USSD code *803# and 8803 interactive voice response (IVR) have been assigned. The system will also have a 24 hour call support service once it becomes operational. These services are provided using five languages including Amharic, Tigrigna, Oromifa, Somaligna and English. Though Amharic and Tigrigna languages are used for the written information the English alphabet is used.
Furthermore, the technology can keep transactions pending for customers for up to two weeks, making it convenient for people with mobile network problems to retrieve them, revealed Abreham.
Customers can have a maximum balance of 25,000 Br in their mobile accounts and daily mobile banking transactions that involve debiting cannot exceed 6,000 Br, in accordance with NBE’s directive.
In addition to LIB, BelCash Ethiopia is working with Somali Micro Finance Institution S.C. and Cooperative Bank of Oromia (CBO) S.C. with all having a uniform money transfer and withdrawal charge, Tewodros Tassew, HelloCash operations manager at BelCash Ethiopia informed Fortune.
The service charge for transferring money ranges from 7.5 Br to 10 Br depending on the sum of money transferred, which is limited to 6,000 Br. While customers, are required to pay at least 10 Br and 26 Br maximum for using the mobile money withdrawal service. But this charge is to be discussed for revision next week at a meeting that will involve LIB, Somalia Micro Finance and CBO.