Stakeholders discusses Strengthening Cash-In/Cash-Out Networks in Ethiopia
Date: 2023-05-04
Stakeholders in Ethiopia’s financial sector at a recent forum held
by the UN Capital Development Fund (UNCDF) have expressed optimism that strengthening
Cash-In/Cash Out (CICO) networks and performance measurement in Ethiopia is a
way to build up agent networks and improving access to financial services.
The UN Capital Development Fund (UNCDF), with support from the
Bill & Melinda Gates Foundation, through a Cash-in/Cash Out project, aims
to improve the reach and quality of CICO networks in Ethiopia. This according to
a statement issued after the forum noted that this will be done through
ecosystem-wide CICO boot camps, technology solutions, and the development of a
CICO measurement dashboard for industry players, including the regulatory body.
The project aims to empower different ecosystem stakeholders to generate
meaningful insights and make evidence-based decisions to ensure the inclusion
and participation of unserved and underserved constituents in the digital
economy. It also aligns with the government's priority of achieving a 70%
account ownership in 2025, per the revised National Financial Inclusion
Strategy II.
The project, which will
run for two years, will focus on several activities. One activity is a CICO boot camp that will train about 15 service providers, including mobile money
providers and their agents, retail banks, microfinance institutions, and smaller
financial service providers in foundational and specialized digital money
distribution aspects such as gender intentional design and technology provider
selection.
The second activity, a Digital Distributor Incubator, will enable CICO managers and technology firms to test the viability of their ideas to determine valuable business outcomes. Selected service providers (CICO providers and technology firms) with the most viable solutions will be awarded US$50,000 and will work with financial service providers to bring their solutions to market. Through this activity, more sustainable solutions can scale faster, offering better services, lower costs in networks, and limiting the amount of dormancy in the agent networks.
Additionally, the
project will focus on supporting the central bank to expand the automated data
collection on CICO and financial services access points as part of financial
institutions' DFS (Digital Financial Services) data delivery. This aspect of
the project will leverage a diagnostic data assessment that NBE conducted in
collaboration with UNCDF. The diagnostic assessment covers a broad range of
data beyond CICO networks feeding into developing an automated solution to
enable financial service providers to report accurate and comprehensive data to
the regulator effectively.
Ultimately, the data collection and analysis tool will enable the National Bank to monitor progress and gaps toward the objectives stated in the revised National Financial Inclusion Strategy. These include conducting trend analysis on fundamental metrics such as the number of agents, distribution of financial service access points, customers, value, and volume of transactions to guide the development of distribution networks or the larger emergence of digital finance and fintech solutions for mass market customers. Committed to improving women's access and use of digital financial services to ensure their active participation in the digital economy, UNCDF's Digital Finance Country Lead, Endashaw Tesfaye, states
“For all activities
across this project, we will ensure adequate representation of female
participants. We will also highlight the case for sex-disaggregated data to NBE
and regulated entities and identify opportunities to disaggregate some data
points by gender.”
Through this project, UNCDF aims to further deepen its efforts in the ecosystem, having already partnered with private and public stakeholders to develop agent management technologies in Ethiopia and improve digital payment services for humanitarian contexts.
Improving CICO networks in Ethiopia and enhancing data collection and analysis for the Central Bank to impact the expansion, viability, and quality of distribution networks will ensure that underserved populations such as women, youth, and rural dwellers in Ethiopia can also access and benefit from the digital economy.
By: Kanto Okanto
