The national switch operator EthSwitch upped its paid-up capital by 2.2 billion birr to surpass the three billion birr milestone in an emergency meeting by the board of directors this week.
Chaired by Solomon Desta, vice governor of the National Bank of Ethiopia, the board authorized the proposed capital on the meeting held last Thursday, March 16, 2023.
The move is part of the company’s effort to execute the revised five-year strategic plan and major initiatives that will be announced shortly.
According to Yoseph Endale, the company’s head of marketing and innovation, new projects have already been identified for implementation. “One of the projects is constructing an office building,” he said.
Based on the information provided by the company to The Reporter, the additional capital comes necessary to “fulfill demands of its business and common infrastructure development requirements,” as well as “improve financial capacity and implement new plans.”
Since its establishment in 2011, EthSwitch has been entrusted with transforming national payment systems and achieving interoperability of financial institutions and digital payment platforms.
“We will strengthen the interoperability,” Yoseph said.
Existing shareholders – financial institutions- will get a portion of the newly issued shares, while new financial institutions will receive the remainder.
Melaku Kebade, Daniel Tekeste, Girum Tsefaye, Dereje Zenebe, and Yehuala Gessese, presidents of Hibret, Lion, Birhan, Zemen, and Abay banks, respectively, were present at the board meeting.
EthSwitch generated revenues of 329.8 million birr last year, an increase of 84 percent year on year. The company’s net profit is increasing at a fast pace. It netted 221 million birr last fiscal year, a 153 percent growth.
During 2021/22, the Interoperable Person-to-Person (P2P) service, which has moved from the pilot phase into the commercial phase, executed over two million transactions totaling 19.9 billion birr.
