Somali Microfinance Institute agrees to join EthSwitch as ‘indirect participant’

The Somali Microfinance Institute (SMI) was announced last week that it will be joining EthSwitch. EthSwitch is an initiative that was established in 2011 to provide simple, secure, effective, and affordable digital payment infrastructure in Ethiopia.

SMI was founded in 2011 and is the first microfinance institution in the country that provides services that comply with Sharia law. Now, SMI is set to be an indirect participant in EthSwitch which is dominated by banks.

The National Bank of Ethiopia owns a 46 percent stake in EthSwitch. SMI had to buy 1035 stakes, of which 60 percent was paid up, in order to qualify for participation.

The agreement will allow SMI’s mobile waller, Hello Cash, to integrate with other existing payment systems throughout the country. Khada Ahmed, CEO of SMI, emphasises the importance of this sort of agreement, and others, in creating a more efficient banking system not only for the organisations involved but for the country in general

EthSwitch received a USD 2.33 million grant as part of the Africa Digitial Financial Inclusion programme of the African Development Bank. Other microfinance institutions that are part of EthSwitch are Aggar, Peace, Vision Fund, One, Buussaa Gonofaa, and Digaf.

Shega

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