Banking on a more connected future in Ethiopia
The convergence of ICT systems with the financial services space within Ethiopia represents a growing opportunity for service providers, institutions and regulators alike.
Bunna International Bank S.C, having acquired its license from the National Bank of Ethiopia (NBE) in 2009, officially began operations in October of the same year.
The company has more than 11,200 shareholders and is marketed as one of the country’s most formidable public-based private banking institutions.
ICT Projects Manager Gezahegn Leta speaks frankly about the market and expectations
* What are the main drivers behind your business?
The main drivers are the high level of expectation in customer service efficiency and proficiency, peer competition, as well as a high level of shareholders expectation for a high earning per share compared to peer Banks. Other influencers include Central Bank directives and regulations to automate and centralize clearing systems, a very large portion of un-banked population in the country (very low even compared to neighbour countries like Kenya), pervasiveness of technology and a growing number of connected users and customers.
* What are the key challenges?
Challenges include stringent regulations that, at times, are too restrictive, liquidity, poor infrastructure and less value being placed on the Influence of Technology as an enabler and a revenue generator. Other factors include considering IT investment as a burden, shortage of highly skilled IT manpower in specific areas and particularly senior positions, as well as alignment of business and technology. Moreover, having a single telecom operator for a whole nation and the lack of Service Level Agreements with telecom service providers represent hurdles.
* Wherein lies the real opportunities in your market
I would say expansion to the un-banked population. Other important opportunities include the drive towards a paperless environment and tapping into the high penetration of mobile users. Customer segregation (focusing on corporate clients that need different levels of service; allocating personal bankers) is a growing influence.
* What is your strategy to market and capture market share within Africa
Capitalizing the fact that Addis Ababa is the seat of AU, UNECA and other international offices, identifying trade relations and other multilateral agreements, identifying emerging markets and sectors where financial service is still in demand.
* What key technologies are playing a role in your business today?
Availability of a reliable and a constant supply of commercial power, Internet and mobile technologies, accessibility and affordability of broadband infrastructure, network connectivity.
* What initiatives/ projects has your company embarked on to drive consumer Awareness?
Usually, TV, local press and media outlets about launch of new products and services particularly on prime times such as major sporting events, using SMS to reach out to shareholders.
* Why is regulation of your industry important and who is primarily responsible for this regulation, policy drafting and implementation
Regulation is important to protect and advance customers interest, to lay a fair play ground for the competition, identify financial needs at a country level and engage stakeholders for the implementation, protect crime and fraud .The Central Bank is responsible for policy drafting and enacting; discussions are held with the stakeholders including private commercial banks. All commercial banks are responsible for implementation and Central Bank is responsible for monitoring and taking corrective actions.
* What do you look forward to most about the growth of this industry?
To a more connected and banked society, more competition and choice for a customer, growth for the industry on a more competitive scale at the horn level and continent wide
* What is your prediction about this growth and the direction the industry it is currently taking?
I hope the sector will open up for foreign investors and foreign banks after liberalization of the telecom sector. The growth of the national economy and the flourishing foreign direct investment will continue to spur other Investments and drive the opening of key sectors like Telecom and Financial Services. The industry will be more competitive; customers will have a better choice.
Chris Tredger, Online Editor