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Ethiopia: Telebirr Launches Micro Credit and Saving Services

Ethio telecom and Dashen Bank partnered to provide digital financial services which mainly target low income earners.

ethio-telecom-logoThe partnership offers micro credit, overdraft, and micro saving services. The micro credit service which is named telebirr mela allows individuals, agents, and merchants to borrow and withdraw money for any transaction while the overdraft service under the name telebirr Endekisse allows individuals to borrow money when they are short of balance in their telebirr account, it was learnt. The micro saving service, telebir sanduq, is a saving service which is available with interest free and interest rate based micro saving services.

It is reported that the micro loan and overdraft services are offered without the need for collaterals. According to Ethio telecom, creditworthiness of the customer and the amount of credit is determined by AI enabled credit scoring system which bases its calculations on the individuals telebirr transactions and telecom usage.

Ethio telecom also stated that the launching of telebirr digital financial services is expected to have a significant effect in ensuring the economic inclusion of the wider community and reinforcing the company’s commitment and contribution to the realization of digital Ethiopia. The company is hopeful that the newly introduced financial services will play a remarkable role in bringing unbanked sections of the society into the formal financial sector.

It is to be recalled that the National Bank of Ethiopia gave a go ahead to Ethio telecom to launch these services earlier this year. The National Bank’s decision was given as part of the ongoing reforms to strengthen the Ethiopian digital economy.

Telebirr, a digital cash that enables 22 million of its users to access financial services, has a total of Birr 32 billion transaction value. Among other services rendered by the digital cash, users are allowed to transfer money locally and make purchases online and at convenient stores. It is expected that the introduction of micro credit and saving services will expand the reach of Telebirr.


 

Source: Ethio telecom