Communications and Knowledge Management Specialist
Some of the participants at the launch event
Participants discussing the immediate interventions that the Working Group Steering Committee has to look at. This was during the break-out session.
The United Nations Capital Development Fund (UNCDF), in partnership with the European Union (EU), and the Organization of African, Caribbean and Pacific States (OACPS), launched a Working Group on Digital Financial Services in Ethiopia. The objective is to provide a platform for collaboration among industry players to accelerate the development of Ethiopia's digital financial services ecosystem. By coordinating efforts and aligning resources, the working group will also contribute to the growth of the digital economy and deepen financial inclusion in the country, in line with the Government's Digital Ethiopia 2025 Strategy.
The launch of the working group is a crucial activity under the 'Digital Finance for Resilience Programme’ that was launched in June last year by UNCDF and its partners with the aim to unlock the potential of digital finance to benefit women, youth and entrepreneurs in Ethiopia. Providing a forum for industry-level dialogue among DFS stakeholders will ensure that no one is left behind in the digital era.
Speaking at the launch event, UNCDF's Eastern and Southern Africa Regional Manager, Mike McCaffrey, said,
"To ensure that digital financial services are impactful at scale, innovation should not be limited to just technology and product development but also regulation. By collaborating with government entities through this working group, the right regulatory framework can be developed to guide the delivery of financial services to ensure that customers' rights, particularly those of the marginalized, are always safeguarded. Moreover, UNCDF has experience bringing local actors together successfully through such platforms to result in concrete actions in the countries we operate. Therefore, UNCDF will work with Ethiopia's local actors from the private and public sectors to address financial and digital inclusion challenges to reduce poverty and ensure inclusive growth."
Reaffirming the importance of digital finance as a critical pillar for development by creating access to financial services for the marginalized, the EU's Team Leader for Economy and Infrastructure Sector in Ethiopia, Sanne Williams said,
"Seeing digital financial service providers come together on such an initiative to collaborate and work together is a leap forging step for the digital economy of Ethiopia." She added that "this effort will increase the ability and efficiency of the different players in the industry and at the same time, it will support the policy and regulation of the country."
The Digital Financial Services Working Group unites financial service providers, FinTech companies, mobile network operators, remittance service providers, pension and insurance providers, and payment system operators. Sharing their insights during the panel discussion on how the working group can achieve significant impact, the panelists agreed that collaborating with policymakers to influence regulation is crucial to designing innovative solutions that enhance access and uptake of digital finance products among underserved constituents.
UNCDF, in its market convenor role, is committed to supporting Ethiopia's DFS ecosystem by working with industry players in the initial set-up and coordination of the working group. However, to ensure the long-term sustainability of the working group, industry players are expected to take the lead role.
In view of that, an election was conducted towards the end of the programme to elect the Chair and Vice-Chair of the steering committee. Yosef Kibret, Vice President, Association of the Ethiopian Digital Finance Practitioners and Chief Executive Officer of Premier Switch Solutions SC, and Nael Hailemariam, Co-founder and GM of Chapa Financial Technologies, were elected as Chair and Vice-Chair, respectively. UNCDF will provide coordination and secretarial support to the working group in this initial phase.
The launch event closed with a call to action for the working group to be innovative in overcoming the common challenges in Ethiopia's digital financial services ecosystem while ensuring a convergence with the Government's national priorities in accelerating and deepening financial inclusion in the country.