• Eyes Progressed Stage in 6 months
ADDIS ABABA – EthSwitch, Ethiopia’s sole Instant Payment System (IPS), has achieved a Basic Level ranking in service inclusivity, according to the 2024 report by the AfricaNenda Foundation.
This marks a significant milestone for EthSwitch, which began efforts to launch an inclusive IPS in 2022 and was previously classified as a non-ranking provider.
EthSwitch’s Chief Portfolio Officer, Abenezer Wondossen, attributed the promotion to the company’s success in facilitating person-to-person (P2P) and person-to-business (P2B) instant payment services over the past two years.
The announcement, made in the AfricaNenda Foundation’s annual report, highlights the potential of inclusive and instant payment systems to drive financial inclusion and economic equity across the continent. “Currently, over 400 million Africans remain financially excluded,” the report states. The report also notes that 26 countries in Africa operate live IPS services, with an additional 27 countries expected to launch theirs within the next 18 months.
Operational IPS in Africa processed over 49 billion transactions in the past year, surpassing the 1 trillion USD mark for the first time. However, the foundation emphasized the need for greater inclusivity to better reach financially excluded populations. IPS systems are categorized into three levels of inclusiveness: Basic, Progressed, and Mature. While no African service provider has reached the Mature Level, nine systems are in the Progressed Stage, and 12, including EthSwitch, are at the Basic Level.
Abenezer told the Ethiopian Press Agency (EPA) that EthSwitch is actively working on several projects to enhance its services and anticipates reaching the Progressed Stage within the next six months. “Achieving this level will provide significant benefits, enabling citizens in unbanked areas to access secure and affordable financial services, free from risks and hassles,” he said.
A key factor in building an inclusive payment system is Digital Public Infrastructure (DPI). According to Girum Fekadu, a digital finance expert and AfricaNenda Ambassador, the Digital Ethiopia 2025 Strategy and the rollout of digital identity cards (Fayda) are instrumental in expanding fast and inclusive financial systems.
Additionally, Ethiopia’s Data Privacy Act will bolster data protection and financial security, laying a strong foundation for the country’s digital finance transformation, Girum remarked.
EthSwitch’s progress is a step toward greater financial inclusion in Ethiopia, with broader implications for improving access to digital finance across Africa.
BY ZEKARIAS WOLDEMARIAM
THE ETHIOPIAN HERALD WEDNESDAY 27 NOVEMBER 2024
