Monday, May 20, 2024

EthSwitch to upscale digital payment scheme


EthSwitch, advances a step further on the digital payment scheme through Person to Person (P2P) account transfer that would ease transfer and pay between financial firms without extra delay and process.
The scheme that EthSwitch tested successfully through piloting has now been commercialized since the regulatory body gave a green light.
In a statement, Ethiopia’s National Switch announced the commencement of interoperability of digital wallet, mobile and internet banking systems run by banks, microfinance institutions (MFIs) and E-money issuers, following the authorization from the National Bank of Ethiopia (NBE) after a successful testing.
“The interoperability enables customers of banks, MFIs and E-money issuers with digital wallet, mobile and internet banking and accounts to send funds from one institution to another. The interoperability includes transfers from bank account to bank account, wallet to wallet, wallet to bank account and from bank accounts to wallet using internet based and USSD channels as well as smart phone applications,” the statement of the digital company explained.
Nine banks and one MFI have participated during the pilot period executing over 125,000 transactions worth 1.1 billion birr. More financial firms are on their way to complete their technical integrations and testing.
The national switch, which is one of the two national switches in the continent, said that as an evolutionary progress from previously attained ATM and POS interoperability, digital wallet, mobile and internet banking interoperability, technically termed as interbank P2P account transfer, is a significant step in achieving Ethswitch’s primary goals of ‘Attaining Complete Channel Interoperability’.
Interbank P2P account interoperability is a mechanism that enables customers of banks, microfinance and digital wallet providers to transfer funds to others or between their own accounts from their mobile devices from anywhere at any time between different financial institutions.
Yilebes Addis, Ethswitch CEO, stated, “Digital Banking Interoperability is a significant step in the modernization and integration of payment systems in Ethiopia, which will help financial institutions leverage existing technology with Ethswitch to provide efficient services, increased reach and smooth customer experience.”
He explained that it ultimately enhances the digital banking uptake by customers and increases the financial institutions’ resource mobilization and customer service monetization capability. “It is also worth noting that in addition to currently operating financial institutions and digital wallet operators, emerging payment system operators will also find this development hugely beneficial as it makes integration with current system so much easier,” the CEO elaborated.
“The most important beneficiaries are the customers, as Interbank P2P Account Interoperability will bring them unprecedented flexibilities in conducting transfer and payments,” the CEO explained.
As a result of Interbank P2P account interoperability, the market share of electronic transactions both for transfer and payments will increase leading to the rise of the amount of money flowing through the formal sector benefiting the financial industry’s effort in resource mobilization.

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