Economy
Banks Resist Fees Imposed by State-Owned FaydaVerse
Addis Fortune · 3 hours ago · Read the Full Story on Addis Fortune
AI SUMMARY
Commercial banks in Ethiopia are pushing back against new mandatory fees introduced by FaydaVerse, the state-owned enterprise running the national digital identity system, for customer verification and authentication checks previously provided for free.
- FaydaVerse, the state-owned enterprise operating the national digital identity system, has begun charging commercial banks and institutions for customer identity verification and authentication checks that were previously free.
- The proposed fee structure features four categories and 11 tiers, ranging from 10 Br to 40 Br per transaction depending on volume and service type.
- The contract requires monthly payments within five days of month-end, bars banks from passing the costs to customers, and obligates them to pay even for failed attempts.
- The National ID Program began two years ago backed by a 350 million dollar World Bank financing over a five-year period, has registered over 51 million citizens, issued nearly 14 million printed cards, and integrated about 150 institutions.
- FaydaVerse was folded into Ethiopian Investment Holdings in August under Brook Taye, shifting to a model where it must earn its own revenue to cover utility and maintenance costs.
- The Ethiopian Bankers Association and its members oppose the terms, arguing they were introduced without adequate consultation despite banks previously purchasing 4,000 registration kits for 17 million Br and building back-end integrations.
- Association Chairman Abie Sano wrote to FaydaVerse requesting joint consultation with the National Bank of Ethiopia, urging zero or near-zero fees for onboarding youth, women, and rural customers.
- FaydaVerse Chief Relationship Officer Saminas Seyfu defended the charges as standard utility fees reflecting international practice, market conditions, and company risks.
- Financial analyst Aminu Nuru argued that verifying basic identity details is a government function and a poor basis for a revenue stream, suggesting FaydaVerse should instead charge for value-added information like credit scores or criminal records.
- The fee dispute coincides with a difficult financial period for banks, whose total expenses rose 91.9pc to 525.7 billion Br in the 2024/25 financial year, absorbing 81.3pc of their income.
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