Addis Ababa Chamber of Commerce President Urges Local Banks to Prepare for Competition with Foreign Banks

Addis Ababa October 28/2022 /ENA/ Local banks need to prepare themselves for the upcoming healthy competition with foreign banks in Ethiopia’s banking sector, Addis Ababa Chamber of Commerce and Sectoral Associations (AACCSA) President said.

Speaking at a the panel discussion on “Opening of the Domestic Banking Sector to Foreign Banks: Opportunities and Challenges”, AACCSA President Mesenbet Shenkute said “we believe opening up the banking sector for foreign banks will benefit the business community as a whole.”

The experience of other countries clearly shows that by creating fair competitive spirit customers and the economy will benefit, she added.

Competition enables financial institutions to provide better services by bringing technology and  new services, among others.

Noting that the decision requires the readiness of local banks, the president stated that  Ethiopian banks have to (therefore) ready themselves for the upcoming competition.

Hibret Bank President, Melaku Kebede said on his part that increasing financial capacity, especially expanding accessibility, increasing foreign currency inflow, technology and innovation, job creation, are among the objectives of opening up the sector for foreign banks.

He stressed that it is crucial for local banks to get out of their comfort zone and play as a driving factor.

All local banks, including the National Bank of Ethiopia, have to reassess their readiness for competition from foreign banks to be beneficial from the opportunities, Melaku pointed out.

Similarly, Dashen Bank President Asfaw Alemu said that foreign banks will bring innovation and marketing experiences alongside technological advancement.  

Providing modern service with creating competition and expanding accessibility are among the benefits.

It is to be recalled that the Council of Ministers decided last month to open up the banking sector to foreign investors, which was only allowed for local banks.  

The decision aimed at supporting financial services with knowledge and technology, moving the country’s economy to a higher level, increasing competitiveness, effectiveness and efficiency.