Historical background of banking industry in ethiopia pdf

The history of banking and other financial institutions in ethiopia free download as word doc. Ethiopian economy and financial sector ethiopia has some notable historical differences compared to other countries in the region. Microfinance in africa iv fworored as the 2015 deadline for achieving the millennium development goals is fast approaching, the incidence of poverty remains a critical issue in. The romans, great builders, and administrators in their own right took banking out of the temples and formalized it within distinct buildings. Banks in ethiopia overview and guide to banks in ethiopia. Virtual banking includes all non traditional and electronic means of banking such as atm, phone banking, internet banking ib, credit cards and debit cards etc. To start with, the researcher accepts the universal argument that banks are unique from other business organizations. Ethiopia industry, information about industry in ethiopia. There has hardly ever been any work in insurance business in ethiopia that delved into the historical and factual aspects of the industry. As a result, the bank branch to population ratio has seen moderate improvement. Origins and early development of banking in ethiopia request pdf. In fact, the history of banking in ethiopia dates back to the turn of the century, when, in1905, the bank of abyssinia was established in addis ababa, under the reign of menelek ii.

Ethiopian banking system is still underdeveloped compared to the rest of the world. Later, in ancient greece and during the roman empire, lenders based in temples gave loans, while accepting. Agricultural and industrial development bank share company by taking. Corporate governance in ethiopia there are a number of companies that are being formed by sale of shares to the wider public unlike most share companies in the past which were formed among founders. National report of ethiopia sustainable development. Evolution of propoor finance after economic liberalisation in 1994, poverty and food insecurity led the government of ethiopia goe to adopt microfinance as a prime component of its new economic development agenda. Hawassa university college of business and economics school. Brown joined monash business school as professor of finance. It is small, relatively undeveloped, closed and characterized by a large share of state ownership. One of them, the ethiopian peoples revolutionary party eprp, believed so strongly in civilian rule that it undertook urban guerrilla war against the military rulers, and anarchy ensued in the following years.

The banking industry is in a much healthier place now than it was after the financial crisis of 2008. Before the commencement of modern insurance service in the country, there have been traditional practices by which people help each other whenever they face either financial difficulties or needs assistance. This was followed by this indepth access to finance in ethiopia study. Pdf the bank of abyssinia, established in 1905, was given a 50years concession by the emperor. In fact, the history of banking in ethiopia dates back to the turn of the century. The birth and development of banking services in ethiopia. Hawassa university college of business and economics school of management and accounting assessing the impact of core banking and service quality on customer satisfaction in commercial bank of ethiopia a case of bishofftu branch by. The case of the association of ethiopian microfinance.

The case for financial sector liberalization in ethiopia. The structure and performance of ethiopias financial sector. Historical background has to do with information regarding the formation date, time of the event, activities, and the business that occurred. Certainly the banking industry in ethiopia is underdeveloped and therefore there is an all immediate need to embark on capacity building arrangements and modernize the banking system by employing the state of the art technology being used any where in the world. Furthermore, iddir is a local association with long history, most widespread, commonly known in rural and urban settings. To start with, the researcher accepts the universal argument that banks are. There is also the development bank of ethiopia, which is not considered a commercial bank. Association of ethiopian microfinance institutions 15 3. In the ethiopian context formal financial sector includes national bank. Especially after world war ii, tourism, banking, insurance, and transport began to contribute more to the. Although occupied by the italians for a short time in the 1930s, ethiopia does not share the colonial legacy of its neighbors. Visit for more related articles at journal of internet banking and commerce.

Doc history of insurance in ethiopia waqo guta academia. Ethiopias growth miracle, coupled with its large population and significant land mass, has attracted. History of financial institutions contributes to the analysis of how the modern corporation, business and finance have shaped and keep on shaping our world. Transfer of funds within the country was also a good source of revenue. Development bank of ethiopia carbon initiative for development cidev component 3 of ethiopia additional financing for energy access project environmental and social management framework esmf for ethiopia offgrid renewable energy program and ethiopia clean cooking energy program final february 2017 addis ababa, ethiopia. Ethiopian banking history started 2000 years ago, during axumite dynasty. Ethiopia remains impoverished, but its economy has become one of the worlds fastestgrowing. Hawassa university college of business and economics. Pdf origins and early development of banking in ethiopia.

Electronic banking in ethiopia practices, opportunities and. The history of banking in ethiopia dates back to the era of the axumite. The first privately owned company in banking business was the addis ababa bank s. Ethiopias real gross domestic product gdp growth decelerated to 7. Electronicbanking in ethiopia practices, opportunities. Access to finance in ethiopia microfinance gateway. Situated in the horn of africa, ethiopia is bordered by eritrea to the north, sudan to the west, kenya to the south, somalia to the east and djibouti to the northeast. The history of banking and other financial institutions in ethiopia. The role of public and private sector banking in ethiopias. The commercial code and the maritme code of ethiopia, insurance 46 provisions 1960. Generally, public banks dominate the financial industry in ethiopia. Insurance in ethiopia historical development, present status. Ethiopian banking system is one of the most underdeveloped compared to the rest of the world. Insurance in ethiopia historical development, present.

Commercial bank of ethiopia is the largest, controlling the majority assets of the industry. In a collection of nine succinct essays, this volume looks at the role of finance in european history from the beginning of the 19th century to the period after the second world war. Tomas hajek ethiopian industry, including both mining and manufacturing, constitutes approximately 12 percent of the gdp, while providing employment for 8 percent of the countrys labor force 1998 est. Ethiopia experienced famine in 1984 that killed one million people and civil war that resulted in the fall of the derg in 1991. Electronicbanking in ethiopia practices, opportunities and. In general the trend is to move away form a dominant public sector towards a financial structure where the role of the. The banking sector in ethiopia has been dominated by the stateowned commercial bank of ethiopia cbe. Banking sector in ethiopia the total number of banks operating in ethiopia reached 15 as two new private banks joined the industry during the fiscal year. In general the trend is to move away form a dominant public sector towards a financial structure where the role of the private sector is becoming increasingly important. The history of currency and banking in ethiopia and the horn of africa from the middle ages to 1935, ethiopia observer, n. In fact, the history of banking in ethiopia dates back to the turn of the century, when, in1905, the bank of abyssinia was established in addis ababa, under the reign.

Established in 1963, the national bank of ethiopia nbe started its operations in 1964. Pdf the short life of the bank of ethiopia researchgate. The production and export of cash crops such as coffee were advanced, and importsubstituting manufactures such as textiles and footwear were established. Ethiopian banking history, in its modern sense, began towards the end of the reign of emperor menilek. The ethiopian central bank issues banking licenses and supervises banks in ethiopia. Electronic banking, or ebanking, is the term that describes all transactions that take place among companies, organizations, and individuals and their banking institutions. Ethiopias economy experienced strong, broadbased growth averaging 9. Another pioneer in this sector is akhtar hameed khan. Download all the latest market reports you need on the banking industry in ethiopia. The paper examines the practices, opportunities and challenges of ebanking services in ethiopia. Called the bank of abyssinia, or in amharic yeityopya bank, it was an affiliate of the national bank of egypt, and was founded in 1905.

This resulted in the establishment of the federal democratic republic under meles zenawi. First conceptualized in the mid1970s, some banks offered customers electronic banking in. Characteristics of the banking sector in ethiopia currently, the banking sector in ethiopia is in a rudimentary and fragile state. The history of banking began with the first prototype banks which were the merchants of the world, who gave grain loans to farmers and traders who carried goods between cities. Ethiopia has unveiled its sustainable and integrated development planning documents, the 5year growth and transformation plan and the climate resilient green economy strategy that shaped the content of. The paper examines the practices, opportunities and challenges of e banking services in ethiopia. Origins and early development of banking in ethiopia. Commercial bank of ethiopia is the largest, controlling the. Click here to instantly access all the reports, in one place. The number of bank branches as at june 30,2011 stood at 681.

Determinants of banking sector development in ethiopia by. Ethiopias economic progress by a range of experts, including the world bank, the. In addition, it restructured the two development banks as commercial banks, and introduced a new banking and monetary proclamation that gave more autonomy and further clarified the national bank of ethiopias activities as the regulator and supervisor of the banking sector. The today use of the expression microfinancing has it roots in the 1970s when organizations, such as grameen bank of bangladesh with the microfinance pioneer mohammad yunus, where starting and shaping the modern industry of microfinancing. The emergence of modern insurance in ethiopia 41 3. In ethiopia cash is still the most dominant medium of exchange and electronic payment systems are at an embryonic stage. Currently there are 17 commercial banks in ethiopia, one state owned and 16 private. There are 10 insurance companies in ethiopia up from 9 in 2007, with about 200 branches across the country. Under haile selassie i reigned 193074, ethiopias economy enjoyed a modicum of free enterprise. Oct 09, 2019 the romans, great builders, and administrators in their own right took banking out of the temples and formalized it within distinct buildings.

The structure and performance of ethiopias financial sector 5 clearly there is evolving structural shift when deposit is observed by institutions. This was followed by this in depth access to finance in ethiopia study. This paper highlights development of ethiopian banking from the beginning of xx century to1936. Establishment of the first domestic insurance company 44 3. Endalkachew abebe a research project submitted in partial fulfillment of the requirement for. Ethiopia has unveiled its sustainable and integrated development planning documents, the 5year growth and transformation plan and the climate resilient green economy strategy that shaped the content of this report. This period witnessed the establishment, as most readers will know, of the countrys first bank. History of insurance in ethiopia modern insurance service in ethiopia started in 1905. Origins and early development of banking in ethiopia ideasrepec. A special feature of virtual banking is the physical absence of the person seeking banking services at the premises and out of premises even abroad. In addition, it restructured the two development banks as commercial banks, and introduced a new banking and monetary proclamation that gave more autonomy and further clarified the national bank of ethiopias activities as the. The derg borrowed its ideology from competing marxist parties, all of which arose from the student movement.